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A month is a long time in politics

April 11th, 2010 admin No comments

How politics can be fickle. A few months ago, in the midst of the spate of suicides at France Telecom, the government came up with a applaudable scheme where all major companies were obliged to negociate agreements with the workers representatives to guard against stress in the workplace. These agreements were to cover areas such as internal communication and the counselling of affected workers, for example , and basically could include just about anything, each company being relatively different.

This was the brainchild of a minister called Xavier Darcos who, as a result of the poor showing of the majority at the recent regional elections, became the sacrificial lamb, and got moved on (possibly to a job as the boss at the Chateau de Versailles, which seems to me to be a altogether more attractive proposition than Works Minister).

Poor old Xavier had created a fuss back in February by publishing ‘name and shame’ league tables of companies who had concluded negociations, those who were in the process… and the naughty boys who hadn’t yet done anything. Obviously those at the bottom of the class, many with a privileged route into the President’s ears, weren’t too happy, and one could suppose that this had at least a minor influence on the organisational change that ensued.

Bring in Eric Woerth, the previous Minister for the Budget, famous for proposing effiencies without once mentioning Lean.

That’s right you’ve guessed it. Since he arrived, the league tables in question have not been updated (despite a commitment to a weekly update). And ‘friends’ of the new minister told reporters that he doesn’t wish to carry on with the campaign (a way of testing opinion?) without anything yet being official.

I wonder how the minister is going to react to the news at the end of the week that an official judicial enquiry is to be opened into the eventuality of ‘moral harassment’ on the part of the France Telecom directors which may have led to some of the 35 suicides in the last two years. Initiated by the trade unions, there are claims of a deliberate campaign to destabilise workers so that they would leave the company. And that the suicides are the tip of the iceberg hiding ‘thousands’ of cases of depression in the workforce.

It seems pretty clear that the tension is going to last for some time in the future. Unless the new Works Minister has something up his sleeve.

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Management by social objectives

March 29th, 2010 admin No comments

In the past I’ve been following the goings-on at France Telecom, which has been at the centre of a lot of media attention – who sometimes and somehow manage to make a link with Lean – following a spate of suicides. Despite the coverage and an increased level of communication between management and representatives of the workforce, there have been another 11 incidences so far this year (none of them however in the workplace) following 25 or so last year.

One of the consequences of the drama has been a change of management at the highest level, and the new boss has wasted no time in addressing the problem head on.

Following 22000 job cuts during the reign of his predecessor, Stéphane Richard, the new General Director, has committed to stabilising the level of the workforce through 3500 recruitments. And there will be no further cases where employees are obliged to move regions just to keep their job (this was one of the root causes of the crisis) and any moves will be based on volunteers (who hoping will be influenced through positive rather than negative incitements).

However, one of the most interesting measures is that of the composition of the variable part of the remuneration of the senior management (1100 of them, there does seem to be an awful lot of layers in there – there are 10000 managers in total). The variable part of their salaries can be anything between 30 and 50%, and 30% of this will be based on their ‘social performance‘.

How on earth do you measure ’social performance’? It does look as though they don’t quite know, just yet. However, the measurable objectives will be determined in collaboration with the trade unions. And an independant third-party will be used to measure the ’softer’ side of the measures through surveys, etc.

Hopefully the results of the negociations will be published, so that we can all learn from an episode that nobody to date can take any pride from.

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Au secours

March 22nd, 2010 admin No comments

Is French Lean going downhill? Have we reached the peak of the wave?

In previous posts, I’ve mentioned the government initiative to ‘relaunch French industry’. Well, not only did the final conclusions not make any mention of Lean at all, but this weekend’s regional elections represented a heavy defeat for the right-wing governement party. Hopefully, there was no connection between the two events.

Joking apart, most of the initiatives that get press exposure seem to be getting off on the wrong track. Actually, McKinsey (no less), back in 2008, came up with the recommendation that the government should be rolling out Lean just about everywhere to get the economy kick-started. I’m sure that there are several of us that would have come up with the same conclusions for a fraction of the cost. Anyway, the government took heed, and starting launching initiatives through the regional economic boards. In every region, twenty or so companies got the opportunity to pay half the going rate (which, by the way, is a rate superior to what would normally be paid, but that’s government for you), the other half being footed by the taxpayers, to have the privilege of twenty days’ consultancy support to ‘roll out’ Lean. And fabulous videos were made showing just how effective the approach was, mentioning the consultants in question in just about every other sentence.

Well, that’s how things work over here.

And more recently, we now have AFNOR (which is something along the lines of the ‘French Agency for Normalisation’, noted for their work on the ISO standards, who have come up with ‘the very first official Black (and other colour) Belt certification’. Official! You must be guessing by now that there probably is a catch in all of this.

You are right. The so-called “experts” driving the Black Belt certification… are the very same ones lining their pockets with government grants to provide a mere twenty days consultancy support to the poor, deluded company directors who reckon that they are going to become Lean overnight.

In summary, we now have a country where the government and its initiatives have never had any less credibility, Lean doesn’t figure in their programmes anyway, and the SMEs see Lean as a means of getting some free cash off the government.

Although we do now proudly boast the world’s first ‘official’ Black Belt Certification.

Au secours.

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Following up on France Telecom

March 9th, 2010 admin No comments

Back at the end of last year, I commented on the initial findings of the report into the goins-on at France Telecom, where there had been a high level of suicides over the previous 24 months.

The second part of the report came out this week, a summary of the 102000 questionnaires which had been sent out to the employees of France Telecom. The report includes 107 – yes, that is a lot – recommendations as to how to improve the current situation.

You see, the independant auditor recognises that, despite the media attention, promises from the executive, and even a change in leadership as of the beginning of this month, things are still a long way from being perfect. In just the first two months of this year, there have been nine further suicides of FT employees, all away from the immediate vicinity of the workplace. And the major obstacle to progress is the lack of confidence the employees have in Human Resources, and in the works medical staff (an obligation in French companies).

Only 39% of employees are ‘proud’ to be a part of France Telecom, and report outlines the need to reinforce the identification with the company. The Human Resource function, the management system and the reporting system all have to be radically overhauled – simplified, in fact, to give back a minimum of autonomie to the workers.

Now, doesn’t this now start to look to be an excellent opportunity for Lean Management?

The matrix organisation in place is revealed to be far too complex, leading to a series of reorganisations which only serve to destabilise the employees – many end up simply doing nothing, as the priorities change all of the time. And the information systems are also seen as a barrier to efficient communications and relations – too many and inadapted to the actual requirements. Finally, objectives and measures are deemed to be “too numerous, too difficult to achieve and disconnected from reality”.

Now, this does seem to me maybe to be something to do with the management style that has developed over the past few years. The report states that management has not been sufficiently open to dialogue, to constructive criticism and to collective reasoning. Rules for promotion are seen to be ‘unclear’. Any meeting with Human Resources was seen as a sign that you were on your way out. And mobility was something that could be imposed upon the employee with little regard for his or her personal situation.

The new General Director of France Telecom, in place since March 1st, will be presenting his plan to the workforce in June. It sounds like that if he could bring it forward a few weeks, he may save another life or two in view of the current climate in the company.

And I wouldn’t think that any of the conditions for a successful Lean adventure exist today.

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Liftoff for French industry

March 6th, 2010 admin No comments

Back in January I wrote about the nationwide consultation ongoing to relaunch French industry. Well, as promised, President Sarkozy presented his plan (or maybe that of his advisors?) on Thursday of last week.

It was all good stuff. There are four overriding objectives :

- increase industrial production by more than 25% between now and 2015

- develop durable long-term perspectives for industrial jobs (no measurable indicators on this one),

- return to a positive commercial balance between now and 2015.

- increase the French share of European industrial output by 2% by 2015 (which I suppose could be achieved either by France improving or the others receding).

To deliver this, there are 23 measures split into five main areas:

- placing industry at the heart of a major project of common interest – this involves setting up a national conference and an ‘industry week’, developing better relationships with the rest of Europe, between industry and higher education.. and between the government and industry,

- developing employment and competencies, through providing incentives to set up in or bring back their activities to France, using experienced workers to help junior ones, and better anticipating industrial requirements in terms of skills,

- reinforcing the regional structures already in place to support industry – part of this includes setting up better regulation of the relationships between larger customers and smaller suppliers,

- reinforcing innovation and competitivity through simplifying regulations (it would be about time) and helping financially companies with promising new products,

- setting up new means for industry to obtain financial support.

Not a lot of surprises, therefore, a major part of the initiatives revolving around the financial difficulties of industry today.

And just in case you were wondering, no mention of Lean in the sections on competitivity. In fact, one could have the impression that the only way French industry is going to become competitive again is if the government gives them lots of money!

Still, there is a whole lot of work to be completed if these are the measures to deliver the 2015 objectives (by the way, the next Presidential election is in 2012). If I was a little cynical (which I probably am), I would finish by saying that these measures are guaranteed to generate new jobs… if only in the local government agencies who are going to have the responsibility of coordinating all of this.

The full report (in French) can be accessed here.

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Best job in the world

March 3rd, 2010 admin No comments

There have been worst periods of industrial strife, but the current social climate in France at the moment is not encouraging. What, with Dutch employers closing factories over the weekend and informing their employees by registered post on the Saturday, or Swedish furniture giants refusing to budge despite striking workers closing down distribution centres and hypermarkets alike, one would have thought that those with a little more comfortable ways of earning a living would be crossing the road and keeping quiet when faced with the hooligans of industrial action.

However, as usual in times of unrest, the air traffic controlers, have insisted on having their voices heard, with the result being that numerous flights have been cancelled and passengers stranded over the past few days… certain categories of airline employees themselves seeing fit to add the ‘passenger experience’.

Now, we have to accept that the level of stress has increased over the past few months. Small business owners wondering how on earth they are going to pay their employees, agricultural workers destroying crops as they lose less money doing so than if they were to sell at the market price, and only this weekend, oyster farmers having their livelihoods ruined by devastating sea floods which cost more than 50 lives.

Therefore, jumping on t he bandwagon, we have the air traffic gang who, under the pretence that they are suffering ‘unvearable stress’ and ‘crushing responsibilities’, decided that they were not going to work anymore (at least for the time being).

Now, to be fair, it has to be agreed that these people do have a responsibility which is maybe more important than that of you and I. However, it also must be said that, on average, they are earning almost five times the minimum wage… for working  – now, hang onto this – just 99 days a year.

266 days of holiday!! Not taking account of leap years. Now, that certainly seems to me to be sufficient time to calm down after a stressful 1.9 day working week. And getting three times the average wage of a small business leader into the bargain. And there are also reports of informal arrangements between individuals – obviously not up to the 1.9 consecutive days – who cover for each other, often leading to security risks for passengers.

So what are the employers doing about it all? Hiding their heads in the sand, it seems.Oh, did I forget to mention that these are public sector workers, and that the boss is the government?

We’re a long, long way from a culture of ‘respect for people’ in this area.

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-2m industrial jobs! Who is to blame?

February 23rd, 2010 admin No comments

The number of industrial jobs in France has fallen by 40% over the past 30 years. A report has come out published by the government which attempts to understand some of the main reasons (albeit analysing only the period from 1980 to 2007, during which 2m jobs were ‘lost’).

The first conclusion is a reflection on the way statistics are collected. Using temporary labour from agencies on the shop floor does not count as an industrial job. It is categorised as ’services’, so that any company which resorts to using agencies to absorb peaks in activity (or even just uncertainty over the future) is in fact suppressing industrial jobs. This effect is estimated as accounting for 25% of the total (half a million jobs over the period) – and this was before the current economic crisis hit in.

Technologicial progress has obviously been a big factor, accounting for 30% of the total. This has led to a decrease in demand for labour but also, through increasing household revenues, has increased the demand for services, thus creating jobs and attracting workers away from industry.

The remaining 45% would come from the effects of globalisation – the commercial deficit of France has grown from 15 billion euros (they didn’t even exist in those days, what would it have been in francs!) in 1980, to 54m in 2007. What the study tried to do was distinguish between foreign competition and French companies which decide to delocalise. And surprisingly, the conclusion is that it is the delocalisations that have slightly the greater share of the 45%, even though it seems to have been difficult to come up with precise figures.

In summary, not taking into consideration the statistical glitches, technology, foreign competition and French businesses themselves each account for around a third of industrial job losses over the past 25 years. Food for thought for the French President and his advisors as they prepare to announce a ‘national industrial policy’ probably next week following the consultation exercise that took place at the end of last year.

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10 propositions to reduce stress – did I hear ‘Real Lean’?

February 18th, 2010 admin No comments

Back at the end of last year, following a spate of suicides in the workplace, notably at France Telecom which I commented on in December, the French Prime Minister ordered a study from three emanant ‘practiciens’ to include propositions which would “improve the conditions for psychological health at work“. The report was published yesterday, and makes interesting reading.

In their conclusions, they come up with some points which, if they’d read ‘Lean Thinking’ and related literature back in the nineties, might have saved them twenty years or so.

As soon as the introduction, we are told that “the real challenge is the well-being of the workforce and them being valued as the most important resource that the company has“.

A number of factors were listed as being at the origin of stress in companies today. Amongst these, we can find:

- “management is too often judged on purely financial performance, with insufficient importance given to social performance”,

- “the poor use of new technologies, which dehumanises relationships at work whilst encouraging virtual exchanges. In just one generation, we have moved from a work collectivity physically close to a community of individuals, connected but isolated from each other”,

-”difficulties in work relationships within a team or with the supervisor when isolation reduce the opportunities of interaction“,

Other factors quoted include the frequency of reorganisations, the fear of unemployment, centralisations which discredit local management, matrix organisations and incessant reporting, time spent in transport, the impersonalisation of the customer interface, and the increasing social role of the workplace.

And the best one for last :

- ” the development of new forms of taylorisme in services. Characterised by standardisation and the isolation of tasks and relations, they can lead to work losing its meaning. When management methods encourage both standardisation and taking initiatives, workers are faced with a paradox. The processes must remain only the means and not the end – they do not resolve the human aspects which depend on the proximity of management“.

I’m not sure whether Lean Management comes out well or not from this, but it certainly shows that for many companies, the continuous improvement aspects have been well understood, but maybe not the ‘respect for people’.

The ten propositions read like an advetisement for ‘Real Lean’, as Bob Emilani would term it :

1) Executive management and the Board need to be implicated in ensuring that performance evaluation includes social and health factors,

2) Reinforce the presence of management in the workplace – the managers have to have authority to make decisions to support his team,

3) Ensure that the workers have the space and time to find their footing and develop as individuals,

4) Implicate the workers representatives in reducing stress in the workplace,

5) Implement measures to evaluate health and safety – we all know that measures influence behaviours

6) Prepare and train managers to actually be managers

7) Promote the value of teams and teamwork, rather than treating organisations as a collection of individuals

8) Anticipate and take account of the human factor in reorganisations and restructurings,

9) Understand that as a customer, your company also has an impact on the health of the employers of your suppliers

10) Don’t leave workers alone – always accompany those in difficulty.

All of a sudden I feel that Real Lean Management has a very healthy future.

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When the going gets tough….

February 12th, 2010 admin 1 comment

… the tough get going. And deserve to succeed.

The big boys don’t want to help the kids anymore. Two of the large aircraft manufacturers in France (you’re probably surprised that there is more than one!), probably through a well-intentioned value-stream-mapping (or cost-cutting) exercise, have decided that they will not longer play a part in supplying materials to their own suppliers. It seems that they were buying in bulk, getting a preferentiel price and therefore offering cost advantages to themselves, to their component suppliers, and also probably to the suppliers of the materials. Win-win-win, what a great arrangement, you would think.

Well, all that’s going to stop, and little Mr.Cable Supplier is now faced with negociating individually, and the material supplier now has tens of orders to take, prepare and ship. And we can very well imagine that the large manufacturers are in no way ready to accept this new state of affairs as a reason to increase costs!

Down here in the south-west, the smaller suppliers have taken it on the chin, and rebounded. 10 of them have created a platform to purchase materials in the same way as before. They’ve created a company called SAS Aero Trade, of which each has 10% of the capital. OK, it has taken two years of discussions, and there were 18 companies at the outset, so 8 have fallen off the wagon somewhere along the way, but it is still a very creditable achievement.The local authorities have been closely involved. As outlined by the President of the new platform, Serge Assorin, “we will continue to benefit from the reduced prices, and we have arranged loans from local governement agencies to finance the initial purchases”. This will even stimulate employment, with two logisticiens planned to be recruited. And if this works, there are potentially other areas of collaboration.

Congratulations SAS Aero Trade and may this example inspire many others.

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Rebirth of French Industry

January 27th, 2010 admin No comments

The title is a tongue-in-cheek reference to Bill Waddell’s excellent book which he could have called something like ‘Industrial Common Sense’, but it’s a good thing he didn’t as I wouldn’t have been able to adapt the title of my blog.

Where Bill is performing solo heroics to try and get the U.S. up and running, it is the French government over here that have realised that industry has been slumbering into the doldrums for a number of years now, and needs a wake-up call before it is too late.

A nationwide consultation programme was launched back in October.  Each of the 20 or French regions was asked to bring in its captains (and also deckhands) of industry and come up with recommendations on how to revive French industry. The regional analyses have to be fed back up the line by the end of January, and at the end of February, the government will take ‘la crème de la crème’ and outline what it is going to do to make the country more competitive.

However, as always, those in the know already know probably 80% of what is going to be announced (in this country, ‘rumours’ are ‘leaked’ before any important announcement just to test public reaction in order to make any necessary last-minute adjustments). Two of the major measures to be announced will be in the areas of,  firstly, sustainable development (helping drive competitivity through making industrial processes and products more ‘green’ and secondly, relocalisations.

Now, Bill Waddell and others have been very vociferous in highlighting the plight of a number of companies who have decided to take the low-cost route only to find that the disadvantages far outweigh the cost of labour. Obviously, this school of thought has not yet reached the ears of the French government, who intend to encourage relocalisations by providing loans to get companies back here. It has to said that this has already been tried back in 2004, and fell like a stone as companies were simply not interested. It remains to be seen whether the response to the ‘leaked rumours’ on this one will see it withdrawn or not in a month’s time.

Another area rumoured for measures to be taken is the relationship between the bigger customers and the smaller contractors, which has swayed much too far in favour of the former. Again, any actions taken will be financial.

Relocalisation and the extended Lean Supply Chain. Two areas where Lean thinking could be far less expensive can the policies currently being decided by the government.

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