July 26, 2016 From the outside in

Volume 8 | Issue 3

Pulling change into manufacturing.

Creating true change in manufacturing is not rocket science. But it is not easy to do either. My research, teaching and industry experience over the past 34 years highlight the need for three critical elements working in combination for true change to take hold. The first is thinking in terms of pulling change. We know what pull inventory is; similarly pulling change occurs when a need for change is signaled, that is, a situation or problem demands the introduction of new ideas. This is different from executive champions pushing ideas and then checking to see if they are being implemented. The latter only leads to short term fixes since employees revert back to old ways of doing things once the pressure is off. Pulling change is also very different than thinking in terms of change agents – people considered to be responsible for introducing new ideas. In pulling change, it’s not the person but the problem that pulls in new ideas.

Secondly, people are needed to find the challenges that become the opportunities to pull in the right new ideas at the right time. Being able to do that necessitates having both an outsider and insider perspective. These outsiders on the inside are firmly planted within organizations, care about their organizations, and therefore have credibility as insiders. But they are able to wear two hats – one as an insider, the other as an outsider who can see where internal assumptions are getting in the way of overcoming organizational problems. The label outsider on the inside is not a job title like facilitator or team leader. It is not a new or added position. These are people who can step back and look at problems with an outside perspective while doing their daily tasks.

The third element for creating true change is building an organizational capability for change itself. Firms need to develop a critical mass of outsiders on the inside, and these folks need a support infrastructure to help them learn to wear two hats and then be in the right place at the right time to find opportunities to pull in change. All too often, potential outsiders on the inside are stifled as they try to identify the need for new concepts and tools in their organization. Sustaining and effectively utilizing outsiders on the inside requires a process – a “people process” much like a production or supply chain process. The critical components of this process (see diagram) are helping insiders to learn how to apply their outsider perspectives, recruiting and assimilating outsiders and helping them to build credibility as insiders without losing their outsider perspectives, and providing preventive maintenance to ensure that outsiders on the inside keep their two hat perspectives in balance. One could easily write off being an outsider on the inside as a gene some people are just born with. But it is much more “constructed.” It is a state of mind that needs continual refreshing and support. In other words, true change is a process that has to be owned by both the organization and outsiders on the inside working in concert to find opportunities to pull in change.

Once a critical mass of outsiders on the insider is built, they become the people who nurture future developing outsiders on the inside and help them to learn to wear and use two hats. It becomes a reinforcing cycle that builds and refreshes an organization’s change capability so that there will be an ample supply of outsiders on the inside ready to use their outsider perspectives whenever challenges arise that require true change to be pulled into the organization.

Janice Klein is a senior lecturer and researcher at MIT Sloan School of Management where she currently teaches leadership in the Leaders for Manufacturing (LFM) and System and Design Management (SDM) Programs. Her recent research, summarized in True Change: How Outsiders on the Inside Get Things Done in Organizations (Jossey-Bass, 2004), explores knowledge transfer and the application of new ideas and concepts at the workplace. Reach her at jklein@MIT.edu.

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