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1. The Role of Lean in Business Execution
Organizations need to learn how to link policy deployment
with project execution methodologies like Six Sigma, and
operational improvement processes like Lean, with
measurement frameworks, like the Balanced Scorecard to
create an integrated cycle of Business Execution, writes Paul
Docherty, CEO and founder of i-nexus. Here's how the parts
fit together.
Often when I meet clients or present at seminars, I am asked to define Lean. I’m very
happy to give my own spin on a text-book definition but if given the opportunity to do so I
prefer to define what Lean does for an organization as part of an overall business
improvement system. In this context, Lean helps an organization to achieve
improvement in three ways, by reducing waste, by reducing variation and by reducing
complexity.
I would say Lean’s main focus is on the reduction of waste, and obviously the
improvement of flow. Although Lean does impact on variation and complexity, on the
whole I would say that Six Sigma, Design for Six Sigma and other redesign
methodologies more predominantly address the issues of complexity and variation. So, I
look at Lean as part of an overall approach which helps to address the three major
constraints on organizations. This is a view of Lean formed in reaction to multiple
experiences but its foundation lies in my first encounter with lean before I recognized it
by that name.
How Perception of Lean Has Changed
My perception of Lean methodology evolved significantly during my time working at a
company called Marconi in the 1990s where I implemented Manufacturing Resource
Planning (MRP2). Reduction of time and the implementation of Kanban were part of our
overall production management approach. This gave me an initially narrow view but I
soon started to learn about the concepts of the wider Toyota Production System and
consequently I became responsible for implementing something similar at Marconi. This
growing impression of the bigger picture of enterprise Lean taught me about the
interdependency between concepts for daily management, like Deming’s PDCA cycle,
and longer range ideas for objective realization and policy deployment, like Hoshin
Planning.
At Marconi, I subsequently went on to become Head of Operational Excellence and it
was in this role that I really firmed up my view of how all of these methodologies and
tools fit together. The project I drove was very Six Sigma focused and large in scale – in
the order of hundreds of belts. I wish I knew then what I know now – that no one
methodology in isolation will be effective. It took me a year before I realized that our Six
Sigma approach needed to be combined with Lean, and that then further methodologies
needed to be built-in to create complete alignment.

2. Role of Lean in Business Execution
My experience at Marconi and the deep knowledge gained during my time as Head of
Operational Excellence has really helped to shape the direction for i-nexus and created
an infrastructure that supports organizations in achieving their goals. When I first start to
discuss challenges and requirements with new clients, this is where I see a big missing
link in their organization. The most effective organizational infrastructure needs to
recognize the importance of cascading goals through Hoshin Planning, of driving
projects at different levels, of interpreting progress and of forecasting success. And as
well as being recognized, these elements of execution need to link together.
I have worked with more than 100 global companies over the past ten years and this has
enabled my view to evolve further. I now firmly believe that organizations need to know
how to link policy deployment with project execution methodologies like Six Sigma, and
operational improvement processes like Lean, with measurement frameworks, like the
Balanced Scorecard to create an integrated cycle of Business Execution.
To make an analogy, I believe that i-nexus Business Execution software is doing for
strategy and objective realization what MRP2 did for the automation of the production
cycle. Ten years ago, no one would have considered using ERP to close the loop in the
production cycle – now they could not imagine doing without it. I will be bold and say the
same thing will be true for Business Execution.
Today people are managing the deployment of strategy and goals through spreadsheets
and individual strategic planning and appraisal cascade documents, as well as using all
sorts of different methods to capture KPIs. There is a lot of heavy lifting involved in trying
to understand all the information and everything is completely fragmented which means
people have no way of knowing whether work throughout the organization is actually
driving and delivering against the set objectives. Business Execution helps to close up
the planning and execution cycle, turning Lean and Six Sigma into critical tools in the
execution process.
This article is based on an interview with Paul Docherty in the July/August 2011 edition
of Lean Management Journal. www.leanmj.com
About Paul Docherty
Paul Docherty, CEO of i-nexus, is an expert in the emerging discipline of
Business Execution. Paul started his career in Marconi, where he held a
wide range of senior management roles covering manufacturing, IT,
sales, product development, project management, Operational
Excellence and corporate strategy as well as having P&L responsibility
for the growth of a regional telecoms equipment business. His deep
understanding of the challenges of establishing robust business execution disciplines
comes from his experience coaching senior management teams in over 100 global
organizations and from leading the deployment of a substantial Operational Excellence
program at Marconi. Paul was a co-founder of i-nexus in 2001, and has spearheaded its
rapid expansion into the leading provider of on-demand Business Execution software.
Paul holds a MEng in Computer Systems and Software Engineering from the University
of York and an MBA from the University of Warwick.
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