Our capacity to change people is essential to achieving a lean transformation. To affect change, teams, and leaders must connect in new and more successful ways, and everyone—from front-line employees to upper management—must have the proper attitudes and skills.

The “core processes,” or those that directly affect the provision of services or the production of goods, are often where most businesses begin their lean transformation. This makes sense in a manner since the main goal of lean is to increase customer value.

So, those in operations are usually the first managers to encounter, attempt to comprehend, and then promote the lean ideology across the firm.

Yet, they swiftly come to the realization that the implementation of lean tools and the process improvements that are starting to occur truly rely on the modifications they can make to their personnel management practices, corporate culture-shaping strategies, and leadership styles. And yet, we can see a significant gap in the majority of organizations: HR, the department responsible for “people management,” often lags behind in lean conversions.

In many cases, the HR department takes on a formal but secondary role in implementing change. For instance, it could plan training without actively supporting the significant organizational transformation that lean entails.

So what should HR’s function be in a business that aspires to change itself and think lean? In order to become strategic partners in a lean turnaround, what should human resources executives and professionals alter about the way they think and behave?

While we don’t necessarily anticipate this post to offer answers, we do hope it will give you some ideas about what a more active and significant role in HR may entail.

We think the following three steps should be taken by HR departments to increase their participation in a lean transformation:

• Fostering a lean leadership and culture
• Changing the value flow among individuals
• Streamlining internal procedures.

Development of lean culture

The HR department often has corporate responsibility for the development of culture and leadership in big Brazilian organizations. Employee participation in the change the firm desires is discouraged by the lack of a lean leadership and culture model that is related to the new procedures and tools, which are meant to be deployed at the start of a lean transformation. While the suggested lean methods first pique their curiosity, the absence of consistency stops the change from taking hold and ultimately renders it unworkable. Processes will deteriorate as a consequence of low participation.

Only when senior management takes the initiative can a lean transition be sustained. This calls for altering leadership behavior and thought patterns as well as the management system and culture. (For instance, examining the company’s own values and principles and highlighting the importance of the value of the client and the dedication to the stability of employees. Or using everyday management techniques to identify issues more quickly and readily. Or altering how leaders see issues, constantly focusing on process improvement rather than placing blame. Instead, by serving as a coach, all employees may become problem solvers and coaches for their own teams.)

Yet without having a thorough knowledge of lean, how can leadership adopt this new strategy? The HR department should prioritize developing leaders and transforming them into lean leaders.

The managerial techniques that help a lean transition. The capacity to develop people by asking the correct questions rather than constantly rushing to supply solutions is one of the two most crucial (and difficult to put into practice) ones. The other is having a Gemba mindset, which involves going to where issues are occurring to witness them firsthand.

The challenge is that lean can only be learned via practice, necessitating the adoption of a strategy that relies heavily on quick cycles of trial, reflection, and learning. Yet it would be wrong to assume that HR doesn’t have a role to play in formalizing and promoting this alternate way of thinking.

A manufacturing department in a company where one of us worked experimented with lean tools and tried to operate according to the lean philosophy, but it was unable to advance because it didn’t engage with the HR department (and other departments, such as logistics and commercial), in discussing the need to align culture and develop leadership to bring about the desired change.

Changing the value flow

An HR department often has sub-divisions like recruiting, evaluation, benefits, and so on, and is organized by activity. It is quite challenging to seamlessly incorporate HR in our attempts to change the company because of this segmentation of procedures and the absence of a comprehensive, regular, and integrated approach to business goals.

According to Mike Hoseus and Jeff Liker’s book Toyota Culture, the HR division is in charge of the “people’s value flow.” Value stream maps are used in lean implementations to examine processes that provide value and the waste they include. When we consider the value flow of people, we notice that the activities that spur learning and growth and push workers to always seek out new methods to provide value for consumers are those that contribute value.

The emphasis is now on each person’s career advancement (or career flow, as we might say) and their contribution to the firm along that flow, starting from the time they join the organization. This constitutes a significant paradigm change. It’s a completely new viewpoint that compels us to reconsider established HR procedures in light of lean concepts and ideas.

For instance, hiring should focus on luring talent with the promise of ongoing learning, collaboration, and the development of problem-solving abilities in a lean firm. Instead of only hiring people with industry experience to fill gaps in the short term, HR should work to identify and choose experts who will uphold the company’s values in the long run.

The managers in the different working areas generally lead the daily management procedures, which are a key component of the value flow of people, but ultimately they too rely on HR for their implementation and upkeep. Why wouldn’t they, then? They call for fundamental adjustments to the way the job is designed as well as new information and abilities.

The people’s value flow is a collection of watertight components disconnected from the demands of the company in many Brazilian firms since the HR department is located distant from the lean transformation, which is often initiated in operations. As a result, there is a significant loss of synergy between the demands of the company, the growth of quality employees, and ongoing learning and improvement.

When employed by a service firm where the value flow of the personnel was unrelated to the requirements of the business, one of us had this experience. A 50% yearly employee turnover rate, which is typical in the business, would negate all of the operations and leadership staff’s efforts to educate new employees and find appropriate candidates.

The rationale behind the HR process

The HR department’s organizational structure becomes increasingly complicated as a firm grows in size. This indicates that lean has a lot of potential to enhance and simplify the administrative procedures that move HR forward and that the managers and staff who make up the department’s internal customers would greatly benefit from this.

There is a propensity to move or outsource many of these activities since they are mostly transactional in nature (payroll processing, benefits payment, and so forth). The HR back office generally has responsibility for other, more people-focused tasks (like hiring or performance reviews). That prompts the question, “Why not make them the focus of our improvements?” Yet, the effectiveness of how these tasks are carried out is crucial to the success of an HR department.

To demonstrate agility and efficiency and to ensure internal customers are satisfied, HR just has to enhance its own internal processes using tried-and-true Lean Office approaches. Remember: Ineffective execution, low productivity, high costs, lengthy lead times, and quality failure do nothing but damage the HR function’s reputation.

The procedures in the HR department are often resource-intensive in businesses with a large number of workers, which is reflected in the severity of the repercussions of bad service or low quality. Nonetheless, while having less “glamour,” they often lack concentration. When businesses see this issue and how it affects costs or morale, they often decide to outsource certain tasks, only to bring them back in-house later when it becomes evident how difficult it is to integrate outsourced tasks with the demands and dynamics of the company.

There are several instances of this issue. One of us worked for a large service firm with a 50% annual employee turnover rate, where the recruiting process was labor-intensive for HR staff, and there was a lot of resentment about the inadequateness of the hired candidates and the delay in filling positions. It was discovered that the recruiting procedure had not been rationalized as the primary reason for this.

Conclusion.

We have identified three paths of action that are interconnected and rely on one another. The company’s overall lean initiatives across departments and functions must include their implementation as well. We totally agree with the notion that lean cannot ultimately succeed until everyone in the business practices it.

Hence, examine the HR department in your company. You may want to take action right now if it is not completely incorporated into the lean transformation. The aforementioned techniques may be a good place to start.