Historically, the principles of LEAN - being the elimination of waste, duplication and variation - have been associated with production and manufacturing, or cross or interdepartmental functions such as purchasing and logistics. Yet very little has been done to apply LEAN techniques to the Human Resources (HR) and Organisation Development (OD) functions.
The favoured method of cost reduction in these areas is often outsourcing. However gains can be achieved in-house through a LEAN approach across a number of value streams that can be reviewed, assessed and scrutinised with a view to improvement actions.
The HR/OD processes that could be subject to LEAN assessments include the following:
Onboarding should be considered as a value stream where success can be accurately measured at each step in the process:
• Employer branding
• The recruitment and selection process
• Corporate orientation
• Probationary period management
• Speed to competency
• Separation - either voluntary or involuntary.
Once each step is measured (using metrics such as staff turnover, stability index, cost of hiring, unplanned absenteeism, and speed to competency), the process of fundamental cost reduction can begin.
Just in Time Training
Just in Time Training is a fundamental LEAN HR / LEAN OD principle, which prescribes that all training must contribute to, and address the needs of, the business. Thus a very simple cost benefit analysis can be conducted which provides valid data upon which decisions can be made. Contrast this with government subsidised training, which operates on the basis that trainees receive a nationally recognised qualification. This raises the question, using the fundamental of LEAN thinking, are we training them for their current job or their next job?
Unplanned absenteeism is another area of concern. Recent research by The Royal Australian College of General Practitioners (RACGP) identified that the average number of sick pay days taken by Australian workers was a little more than nine per annum, “about half [of which] were medically related.” Implied is that four to five sick days are taken for reasons unrelated to personal illness.
This practical Australian based research can be used in any LEAN HR intervention. The RACGP has also investigated “presenteeism”, which is the behaviour of not having time off when sick and thus infecting fellow workers.
Performance Appraisals (Pas) are in direct conflict with the principles of LEAN HR / LEAN OD, as they are a duplication of effort and thus wasteful exercise. This is because managers are paid to manage and not hand that responsibility to a centrally administered PA system run by HR.
Safety systems are also fertile ground for the scrutiny of the principles of LEAN. Firstly, workplace safety cannot be purchased and there fore a safety bonus is out of the question. Bloated safety departments cultivate a culture of learned helplessness, where responsibility and accountability are transferred to the Safety Department rather than being the personal responsibility of each and every employee.
HR and OD may be the last bastions of LEAN, but the benefits these departments can reap from LEAN are enormous.
Interested in applying LEAN principles to your Human Resources or Organisation Development function? Please contact us.