A Lean Mindset

Early in my career, I questioned why Toyota let competitors visit their factories. In my view the Toyota Production System was their competitive advantage, so why would they share the recipe for their secret sauce with others? I assumed they were making a huge mistake.

It was much later that I realized true lean isn’t about learning one tool or one practice. It isn’t just visual management or standard work or single piece flow. You don’t have the recipe after one visit to the factory. True lean is a mindset. It is when the lean practices and tools become so deeply embedded in how an organization works that they create a problem-solving culture where problems are embraced, owned, analyzed, and fixed. When you boil lean down to its basics, it really is about focusing on the customer with a maniacal pursuit of elimination of waste and unrelenting prioritization.

If this anecdote sounds familiar to you, you’re right. I shared this reflection on Toyota after my first trip to genba as GE’s CEO more than three years ago. I remember that visit fondly as I saw fertile ground where lean could grow. Three years later, I am proud of our progress. We have shifted from “trying lean out” to embracing it. While we have more to do before lean is deeply embedded, it is clear lean at GE “is not a moment, it is movement,” to quote the musical Hamilton.

What has changed over the years is the context in which we are operating. Three years ago, GE was very much a self-help story. We had to strengthen our businesses and improve how we work. Today we are stronger and simpler in our operations but the world around us is tough. Inflation, supply chain constraints, recent COVID impacts in China, and global unrest are presenting new challenges.

I'm so glad for a host of reasons that we've been on our lean transformation and that we have stayed on that path, not the least of which is in an environment of great uncertainty, lean is the best formula for us to perform. It helps us focus on “controlling the controllable,” as my mentor at Danaher George Sherman used to say, by:

• Putting our customers first - focusing on on-time delivery and delivering a higher volume of products to meet the strong demand across our businesses.
• Being disciplined in our pricing and-, especially given the inflationary environment, working closely with customers to deliver value.
• Taking a hard look at cost structure - leveraging lean to drive productivity and support margins.

We cannot sit around and wait for the world to get better. A lean mindset that focuses on safety, quality, delivery, and cost (SQDC) gives us the tools and instincts to make the right decisions and necessary trade-offs. It ensures that the actions we’re taking today are rooted in long term sustainment and improvement. Lean is a glove fit for these times and as I wrap our 2Q operating reviews, I am encouraged by our progress.

Next week is GE’s Leadership Kaizen week. As you know kaizens take place every week at GE, but this annual week is a chance for the leadership team to be fully immersed with our operators. I will be with our GE Aviation team working to reduce the lead, waiting, and cycle time in one of the site mills at our Wales Maintenance, Repair and Overhaul(MRO) site. These weeks are energizing as we improve our work for our customers; improve our operations for our teams and further our journey to lean as a mindset.

Larry