Inside look: Nationwide’s lean IT management

This edition of Think OpEx features a guest blogger: Tom Paider, an AVP and build capacity leader at COE member Nationwide Insurance. Paider, also a graduate of Fisher’s MBOE program, will give an inside look at the lean transformation that took place in Nationwide’s IT division.

You’ve probably heard talk about the need for management to change when undergoing a lean transformation. The principle is simple: How can we expect our staff to change if we as managers don’t change as well? While the principle is simple, the implementation of the principle isn’t so simple. Many managers believe they’re where they are because they know best how to direct their subordinates They believe their role is to assign tasks, monitor progress and assess performance.

Culture, Values and attitudes, What we do
Focus on what behaviors you want people to exhibit, then design processes around those behaviors. It’s much easier for people to act their way into thinking than think their way into acting.

How, then, do we transform these managers to a lean mindset focused on coaching, problem-solving and empowerment?

In my experience at Nationwide, this management transformation follows the same general pattern as staff in lean transformations: Changes to daily behavior used to change thinking over time. It follows the pattern outlined in John Shook’s MIT Sloan article “How to Change a Culture: Lessons from NUMMI”. Shook surmises it’s much more difficult for an organization to think its way into acting than to act its way into thinking. By approaching transformation from a daily behavior standpoint, the change is baked directly into the DNA of the organization and backslides are much less likely.

When we first deployed a lean framework to Nationwide’s Application Development Center, our managers were supporters but ultimately didn’t change the way they worked. This caused confusion within our teams as staff moved toward collaboration, empowerment and problem-solving while the management team still operated in a command-and-control hierarchical style. A management team that didn’t understand how to channel the enthusiasm of the staff quickly snuffed out the initiative of our associates.

So how did we do it? We put in place processes that reinforced the behaviors desired: A focus on coaching staff instead of directing them, building problem-solving muscle throughout the organization, and getting them out of their offices and to the gemba.  We focused on daily accountability through tiered standups, visual controls and visual workflow for the work of management, and leader standard work that governed the expected behaviors.

In a subsequent blog post, learn what each of these looked like and how we implemented them. Stay tuned…

Taco Bell COO hosting exclusive chat with students Friday

When the Center for Operational Excellence hosted Taco Bell COO Rob Savage on campus last month, he told the crowd it’s important to never feel stitched into one line of work.

“You have a lot of skills you can apply to different industries in different situations,” Savage said.

Taco Bell COO Rob Savage
Taco Bell COO Rob Savage spoke at a COE seminar last month.

He would know. A graduate of Ohio State University’s engineering program, he got his start in the world of manufacturing, working as a production supervisor for General Motors. Two decades ago, he joined Taco Bell as a market manager and has risen through the ranks to oversee the operations of a chain that serves 35 million customers a week.

Savage’s undying love for Ohio State (and its undefeated Buckeyes) is bringing him back to Fisher this Friday at 9 a.m. in Pfahl Hall 202 in an exclusive chat with students, hosted by COE. Fisher offers students a wealth of opportunities to interact with successful people in the world of business – but not every chance will be as intimate as this one.

The smashing success of Taco Bell in recent years (Doritos Locos Taco, anyone?) says plenty about Savage’s skills as an executive, but his passions extend well beyond expanding the brand and driving financial success. Savage is passionate about the success of students at all levels of education – and he’s here this week because he wants to be.

Don’t miss out on this opportunity. E-mail Jackie McClure at to reserve a spot.

‘Adversity is a part of life’

The arc of Gail Marsh’s personal and professional life is part success story and part cautionary tale – and she’d acknowledge that as much as anyone.

Gail was gracious enough to share that story as part of a regular series of women’s leadership breakfasts the Center for Operational Excellence hosts, sparking a discussion with nearly two-dozen women from our member companies and students at the Fisher College of Business (check out more photos here). The strategy chief for the gargantuan operation that is the Wexner Medical Center at Ohio State University, Gail also is actively involved in community efforts around town. Those garnered her the honor of being named one of six Women of Achievement by the YWCA of Columbus last year.

Gail Marsh Wexner Medical Center
Gail Marsh shared her story and offered insights at a COE women's leadership forum.

If that isn’t enough, she’s a mother to three children she raises with her husband, Dr. Clay Marsh, an OSU professor and vice dean for research in Health Sciences and the College of Medicine.

Listening to Gail speak last week, I was impressed with how her story contains not only great wisdom for women but for anyone who works hard for what he or she earns and takes a step back, wondering how to balance it all. An undergraduate and master’s degree-earner from OSU, Gail was the proud owner of post-graduate student loans as she worked her way up in the male-dominated world of health-care administration, found love and started a family. It was the loss her mother that prompted her to realize she was moving too fast, life was too short and she needed to hit the reset button. With that, she began to create a work-life balance she says she’s still working to perfect, even though it has the flexibility she needs.

Not that her flexible schedule came on a silver platter.

“You have to be stellar at what you do for people to give you flexibility,” she said. “Everybody is balancing things.”

Some other wisdom Gail imparted at our event:

On taking the plunge into community service: “If you wait until all your work is done, your laundry’s done and all your kids have straight As you’ll never do it.”

On the secret to her own life: “Understanding that adversity is a part of life is the secret to my life now. It’s just going to be that way.”

On career mobility: “I like to think my promotions in the medical center have been because I know how to solve problems.”

Check out more from Gail in a video tied to her Women of Achievement honor.

MBOE recap: The Weakest Link (…goodbye.)

Students in Fisher’s Master of Business Operational Excellence cohort are back on campus for their second week together in the year-long program. Senior lecturer Mrinalini Gadkari is on the scene for daily recaps.

As lean guru Tracey Richardsontaught our MBOE students the problem-solving process at Toyota, the thing that amazed me the most was that she rarely used the word “car” or anything close to it. She spent a major part of her time talking about culture and people instead, asking: “Does your company have values?” More importantly, she said, is whether your people believe in them. That, Richardson said, is the weakest link in a company.  Most organizations boast having values, but do leaders have the discipline to live them and hold people accountable? Have they internalized the values to reflect in their character? That’s where most organizations lag.

Tracey Richardson
Tracey Richardson coaches Fisher’s MBOE cohort

An example of a good leader sticking to values, in this case safety, remains in my mind: This company’s CEO was walking with me down a hallway when he noticed a paper clip on the floor. Without a moment’s hesitation, he bent down to pick it up, threw it away and we kept walking. He didn’t have to say a word. That company’s core value was conveyed through that action. 

Culture begins with leaders. People internalize what they see and hear their leaders doing consistently. The “true north” goal at Toyota can be described in one line: Customer first, the highest quality product, lowest cost, shortest lead time, safest manner, while respecting people. At Toyota, to create the highest quality product, they hire the right people in a systematic manner, train them to continue to have standardized processes, encourage them to highlight and solve problems in a systematic manner and value their inputs. Once a month, Richardson said, the president of Toyota would go to the shop floor and spend two hours working on the line, letting front-line staff help the manager on other processes. What a commitment from the president!

Discuss: How do you see the core values of your organization play out in everyday ways?

Show me what you got

I got my first real taste of old-fashioned, machismo-fueled negotiation when I wrecked my car earlier this year. Thankfully, I wasn’t the driver to blame, wasn’t hurt and was driving a 15-year-old parental hand-me-down I secretly wished would suffer that fate. Nonetheless, one totaled vehicle meant finding another with a settlement check from an insurance company in tow – and both of those would put me face-to-face with people who assured me they were giving me the best deal they could but were clearly lying through their teeth.

In both scenarios, I (naturally) feel I came out on top in retrospect. Talking an insurance adjuster into a few hundred extra dollars is no small feat and my performance in the car salesman’s office would make Ryan Gosling jealous.

I thought about both of those negotiations last week, when the Center for Operational Excellence hosted a forum for our member companies’ administrative assistants. The brave souls that trekked through an unusually blustery and snowy Columbus day got a hands-on crash course in negotiation from Maggie Lewis, a lecturer in the Fisher College of Business. Unfortunately, that thinking led me to realize the kind of negotiating I did wasn’t that tricky. I cared nothing for the results or the feelings on the other end of the table, a classic “win-lose scenario.”

Maggie Lewis
Maggie Lewis, presenting at COE’s administrative assistants forum

The kind of negotiating we do in our lives as lean thinkers is much tougher than balking at a sticker price. In a realm where responsibility is shared, blame is avoided at all cost and flow requires buy-in and cooperation from everyone involved, negotiation is a tightrope walk. On one end is the current state, riddled with problems and inefficiencies, and on the other is the future state your pursuit of operational excellence will take you. The last thing you need is a disgruntled colleague with a good pair of garden shears.

Lewis during her presentation made a few comments that struck me for their deep relationship to lean principles, chief among them: “Negotiation is just problem solving.” Any manager could tell you that sentence works in both directions.

MBOE recap: Who is Tim Wood?

Students in Fisher’s Master of Business Operational Excellence cohort kicked off their first day with an introduction to value-stream mapping by Gary Butler, an executive in residence in the Management Sciences department. After a good discussion about what value is and who the customer is, Gary gave students a handy acronym, TIM WOOD, to remember the “seven deadly wastes” in any process: Transportation, Inventory, Motion, Wait, Overproduction, Over-processing and Defect.

In the afternoon, we had the honor of listening to Steven Spear, author of The High-Velocity Edgeand a well-recognized expert on leadership, innovation and operational excellence. Steve articulated the inside mechanism of the Toyota Production System in his exceptionally simple and persuasive style in two hours – using only two PowerPoint slides that centered around this question: “What’s Toyota’s real innovation? Is it their car or the management system?”

Steven Spear is the author of The High-Velocity Edge
Steven Spear is the author of The High-Velocity Edge, which examines the behaviors behind successful lean enterprises

Steve pointed out four major characteristics of the Toyota Production System, which he wrote about in a landmark 1999 article in the Harvard Business Review:

  1. System design using the best approach making the problems visible
  2. Problem solving by escalating and asking for help; containing the problem, and solving it when it is still a micro problem
  3. Knowledge sharing and applying the discoveries systematically
  4. Engaged leadership that focuses on managing systems and developing people

The day ended with students practicing current-state value-stream mapping for a simple business case of the pencil pushers and were introduced to a number of concepts. Some students struggled but it’s expected. They’re eager to learn more and had many great questions. At one point we had to remind them that they cannot learn everything in one day. There’s one whole year to go!

Here are some end-of-day reflections:

–          If Toyota has found success in nesting to address problems, why does modern business encourage a flat organization?

–          It is important to design the work such that one can see the problems

–          Mistakes are okay as long as I learn from it and make changes based on what I learned

A long day but a great day!

New operational excellence program at Fisher makes big debut

Excitement is high this week at the Fisher College of Business as we launch the first cohort of our MBOE Healthcare Program. MBOE, by the way, stands for Master of Business Operational Excellence, a program we introduced three years ago with a group of students mostly from the manufacturing and service industries. In the last cohort, however, we noticed nearly half of the students were from the health-care sector – and what we did about it is this very program.

Dean Poon
Dean Poon speaking to the MBOE class

MBOE Healthcare is a one-year program focused on achieving operational excellence using lean and Six Sigma, combined with effective leadership skills and team engagement techniques. The program aims to develop each student – a manager, leader or other professional with a passion for operational excellence and change –  while improving the systems and processes in his or her organization. 

This MBOE program isn’t just in a classroom. Students will head to hospitals to visit the gembaand observe successful changes. They’ll also take part in online learning and a combination of on-site and distance coaching by industry experts. The students apply this knowledge to a strategic capstone project carefully selected with the active involvement of the student’s supervisor or sponsor. They also work closely with the original industry cohort in the four weeks they’re together on campus to learn from each other.

MBOE Students

Each of the eight weeks on campus involves four full days of intense learning from Wednesday to Saturday. Past students have called these weeks “exhausting and exhilarating” as experienced faculty members and guests teach using their own experiences working in organizations all over the country.

A student of class 2011, Susan Moffatt-Bruce, Assistant Professor of Surgery and Chief Quality and Patient Safety Officer at the Ohio State University Medical Center, told me the program “has provided me the tools to implement change through shared understanding and team engagement.”

Stay tuned for a daily update on the first week of the MBOE program.