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Tripp Babbitt

Six Sigma

Systems Thinking Saves Service

If you want change, change your mind

Published: Thursday, August 5, 2010 - 05:30

While reading an issue of Quality Digest Daily, I came across an article by Kenneth Levine and Peter Sherman titled, “Ten Simple Principles for Treating Employees as Assets.” I thought it followed the usual themes about engaging employees and driving out fear until I ran across the following jewel in No. 9:

“Organizations must continue to improve to survive. Therefore, some consistent method (with a consistent vocabulary) for improvement is needed. Lean Six Sigma is by far the best available methodology for doing this because this methodology continues to adapt and grow, and no other competing methodology is apparent.”

Really? The authors must never have heard about systems thinking. Well, let’s pull up a chair and talk about service and improvement, and using systems thinking.

I previously wrote about this in my article “Redux: Rethinking Lean (Six Sigma) Service.” The message is relatively straight-forward: Treat service like manufacturing and service gets worse while costs increase.

Manufacturing is different than service in many ways. One important difference is that the variety of demand that service organizations receive from customers is greater than in manufacturing. The inability to design service systems that absorb this variety creates waste in the form of failure demand (demand caused by a failure to do something or do something right for a customer, according to John Seddon). Failure demand becomes an unintended consequence of treating manufacturing like service.

What is systems thinking?

For me, systems thinking means that to get improvements, we have to address the whole system and not just processes. This means customers, organizational structure, policies, rules, work design, measures, compensation, and everything else in an organization has to be “in play” to make systemic improvements. Too many improvement efforts focus too narrowly on efficiency and miss being effective because all elements of the system aren’t addressed.

Fundamental to systems thinking is that all systems are unique and different. This is important, as processes such as copying, best practices, and benchmarking do not help organizations improve. I believe that every organization has in it what it needs to improve. Looking outside to other industries and competitors adds little value and more often leads to expensive studies or blind copying that increases costs.

Most organizations have learned to think and be managed in a command-and-control manner (see command and control vs. systems thinking). But to be a systems thinking organization there needs to be a change in the way the organization thinks. This change has to come from a different perspective, work design, decision-making structure, set of measurements, attitude, role for management, and motivation. Ignoring all or part of these processes will lead to suboptimization or an increase in total costs.

What is so different about systems thinking?

There may be different methods for systems thinking, but I will use the vanguard method for discussion purposes.

Having been down the path of lean Six Sigma as a Master Black Belt, I can tell you that there are huge differences. A few of the differences between lean Six Sigma and systems thinking are:

A de-emphasis on the use of tools. In service organizations, the use of tools is not emphasized or even important except for the use of statistical process control (SPC) to know whether service functions are getting better or not. There is no 5S or standardization as in manufacturing. The use of such processes typically does not allow for absorbing the variety of customer demand found in service. Manufacturing tools were invented to solve different problems unique to manufacturing.

Efficiency does not trump effectiveness. Raissa Carey wrote a great article that demonstrates this in “Starbucks Lean Ruins the Experience.” If service organizations change what makes them unique and different for the sake of efficiency, they miss the point. Not everyone wants their coffee from McDonald’s and there are reasons for it rooted in the customer demands that need to be studied from the outside-in. This is what makes service organizations unique. When all service organizations aspire to be the same, it's boring… and sounds more like we’re trying to be like a communist state using inside-out efficiency to reduce costs.

No projects to improve, change is emergent. Managers in systems thinking are in the work, so change happens quickly. There is no need for management reports and prioritization to see which improvement project kicks off first and then develop project plans to implement. Instead, managers and staff work together in the work to get knowledge on customer purpose and the “what and why” of current performance, which leads to customer measures and experimentation with methods to improve and innovate.

Methods and innovation, not results or targets. Anyone doing a Six Sigma Black Belt project knows that results are all that matters. Managers ask, “How much will doing this project save the company?” This question is the wrong question, just as the tools are the wrong place to start. The Wall Street Journal reports more than 60 percent of improvement projects fail. The scope for improvement should be determined by the management and staff, and their willingness to tackle all elements of the system that inhibit performance (as defined by customer purpose). By experimenting with methods, innovation results.

As manufacturing plants have disappeared we have seen more people move from manufacturing to service. They bring manufacturing tools with them. More service industries, such as hospitals, banks, and others are falling into the trap that service is the same.

As for Levine and Sherman making such statements as, “Lean Six Sigma is by far the best available methodology for doing this [being a consistent method for improvement] …” I beg to differ. And I have been down the lean Six Sigma path.


About The Author

Tripp Babbitt’s picture

Tripp Babbitt

Tripp Babbitt the managing partner for The 95 Method - Executive Education and Advisors. The 95 Method is about giving organizations a method to use new theories to grow business.  Babbitt can be reached at tripp@the95method.com. Reach him on Twitter at www.twitter.com/TriBabbitt or LinkedIn at www.linkedin.com/in/trippbabbitt

Tripp also does two podcasts: The Deming Institute Podcast and The Effective Executive podcast. 


Tools are easier to sell than doing the right thing

I think the problem is how Lean was designed to sell the tools to organisations (as this is a better way to make money from organisations) than to help create an organisation that continually learns and changes their own thinking based upon knowledge. Tools are an easier sell. It appeals to the command and control mindset, oh a tool I can apply, instead of a more permanent transformation. When you see the managers wielding Lean tools in the UK and the devastation that they have caused in the UK service industry. Alongside standardisation Lean is part of the wholesale industrialization of services that has damaged the customer experience.

Violent Agreement

This little civil war between the systems thinking blue and lean gray is entertaining and a little sad. It's like a heated argument between Methodists and Baptists about the nature of God. Guess what: God doesn't care.

And, by the way, why hasn't anybody noted that the cover of "Freedom from Command and Control" uses the subtitle "Management for Lean Service" with an advertising splash "The Toyota System for Service Organizations?"

Lean -- when done right -- is a set of concepts and, yes, tools that serve as a guide to seeing the organization as a system. It's all systems thinking. AND IT'S ALL DEMING. But when people start using the tools and concepts without grasping the systems thinking that underlie them it's fair to label them "tool heads." The problem is with the way people apply lean thinking, not lean thinking itself.

Only Sadly Mistaken

Unfortunately, many that have commented have not experienced systems thinking Vanguard style, so with that in mind don't speak with knowledge. They speak what they believe to be true, which is little more than an assumption.

To say it is all Deming is not all wrong, but is mostly wrong. There are certain elements that are based in Deming, but when I look at improvement I don't think one should look solely at the past. One should look to new learning and understanding in achievement of improvement. Dr. Deming left the door wide open in the area of psychology and changing thinking and many efforts to apply new thinking to organizations has been developed by Vanguard.

I am one of very few that have walked both sides of the fence, and the approaches are extremely different. I don't expect you to trust me or anyone else on this matter or what the differences are . . . only the curious.

More Copying

Clearly, the lean folks want you to copy. Nice ad, Mark. And now we have "modern" lean, which must be the new and improved version of lean.
I didn't see your response to what is in the lean tool box for human system change methodologies that Barry asked about.
I also suspect that you (Mark) will not allow me to have the last word on MY article, so much for lean's respect for people.

Closed Minded

It's easy to see who the closed-minded people are if they reject an approach, like the application of Lean/TPS at ThedaCare, without reading about it. It has been transformational, they learned from Ohno, Deming, and yes even Womack. They figured out how to make it work. There's nothing static and "codified" about modern lean.

You can tell who the closed-minded John Seddon followers are - hint, they say "failure demand" and "do not codify" constantly.

Can somebody please provide a page number in which book where Ohno said that?

The Final Word

As always an interesting (and sometimes contentious) discussion. I believe an important one to get to improvement efforts that work in service.

Many folks are having great success with their improvement efforts, and if you are, keep doing what you are doing. For those that are not, keep seeking. For people like me, the search is never-ending and I hope they take a look at what systems thinking has to offer.

I thank all of you that have taken the time to send me comments - both positive and negative. And the scores of you that have taken the first important step by downloading "Understanding Your Organization as a System" (or other downloads) and/or signed up for my newsletter.


Barry, first don't confuse Lean with "Lean Six Sigma."

Why would you say there's nothing transformational in the Lean approach? Have you read The Toyota Way and noticed how different than is than most organizations? Have you read "On the Mend" about the cultural transformation at ThedaCare, a hospital system in Wisconsin?

I'm curious to hear about data that backs up your inaccurate generalization.

Confused - I don't think so!

Mark, first don't confuse Toyota with 'Lean'. The Toyota Production System is the application of a theory of work based on a systemic view of the organisation. 'Lean' is the codification of the TPS by Womack & Jones in The Machine That Changed the World and yes I heave read it. As Ohno said, and yes I've read his book too, never codify method - QED a codification of the TPS defacto cannot be the TPS - So first point - Doing 'Lean' isn't 'Doing' Toyota.

Lean Six Sigma = Project management on steriods with bad theory and targets, i.e. All bad stuff in service systems!

Is Toyota different to most other organisations in the world - you bet! Is it different because it did Lean or Lean Six Sigma absolutely not.

Would I say there's nothing transformational in the Lean approach? - Yes I would.
Have I read The Toyota Way? - No.
Have I read On the Mend? - No.
Do I need to have read these two books to make the comment I did? - No.
Why? Because I was commenting on human systems change methodologies. As methods of change in human systems Lean and Six Sigma rely on rational and/or coercive approaches and these do not change thinking, the point I was making.

A method issue


Mark wrote –

"There are countless organizations out there, in manufacturing and healthcare, that are transforming their culture, and management systems, and thinking. They are becoming effective by engaging everyone in reducing waste and providing the right value to the customers and patients. And they are practicing "kaizen" every day, it's not just a bunch of projects."

If these organisations are changing their culture it can’t be because of Lean. There is nothing in the ‘Lean’ or ‘Lean Six Sigma’ toolbox that would cause such a transformation in thinking.

Love LSS

I just received the latest Vangaurd newsletter. In it, Mr. Babbitt states "I love LSS for manufacturing, but service has different problems. "

I wish Mr. Babbitt would have stated or implied this in his Quality Digest article. I certainly did not get this impression from his Quality Digest article. So there may be value of LSS in certain applications within certain systems?

I did

Maybe people read what they want to read, here is my quote from this article:

"Manufacturing is different than service in many ways. One important difference is that the variety of demand that service organizations receive from customers is greater than in manufacturing. The inability to design service systems that absorb this variety creates waste in the form of failure demand (demand caused by a failure to do something or do something right for a customer, according to John Seddon). Failure demand becomes an unintended consequence of treating manufacturing like service."

Taiichi Ohno was trying to solve a different problem in manufacturing than what we have in service. Both W. Edwards Deming and Ohno warned against the codification of method . . . here lies the problem.


"There is no 5S or standardization as in manufacturing." No wonder I get such varied and sometimes satisfying or dissatisfying service at banks. There is no standardization and they can't find the tools they need like application forms or bank deposit slips. I don't believe this statement one bit.

Raissa Carey's article “Starbucks Lean Ruins the Experience." was really about bad implementation of a principle. It is really unfortunate that we condemn the methodology because of bad implementation.

Absorption of Variety

Manufacturing starts with standards as they have a different problem to solve. Customer demands are different, usually I find that service is different because of all the droids we have on the front-line hand-cuffed by technology, rules, procedures, etc. So the bad service you get is a more likely a result of the system design.

I keep hearing about bad implementations in lean, seems to be more bad implementations. Wasn't Shook involved with implementing lean at Starbucks? I thought for sure he would have gotten it right.

What's to say...

Tripp, what's to say that Raissa's article had it right about how Starbucks is going about Lean? There was a lot of speculation in her piece about her fear that lean would hurt service at Starbucks, based on a comment in the WSJ that said some baristas feared what lean would lead to bad things. She wrote about one experience at a Starbucks. That could have easily been a location where they weren't yet doing any Lean training or improvement, as we've all had inconsistent or sometimes surly service at a Starbucks - pre-Lean. Her speculation that Lean was to blame for an unfriendly barista is unfounded. The CEO of Starbucks said their goal was to IMPROVE the customer experience. This means freeing up time (eliminating waste) so that baristas can focus more on customers, not less. Raissa's piece was a bunch of speculation, just as it's your speculation that Shook is doing a poor job with Starbucks. You'll say I'm making excuses and sticking up for my buddy, but whatever. Neither you nor Raissa are speaking with facts, in relation to Starbucks, you're speculating.

System Design and thinking is at fault

Here is one of the problems the CEO wants to improve the customer experience which becomes the first wrong step. He didn't get knowledge (he assumed) what customer demands were, he decided to implement lean to make this happen. Systems thinking is not an implementation, it is a theory of work. The first step was coercion not understanding. By coercion I mean he decided to implement. One problem with change management programs is the command and control style in which they start.

Raissa shared her experience, others have shared the same thing. When will management go to the front-line to see what the real problems are and what customers want before THEY decide what to prescribe. Is spending more time what Baristas see as the problem from studying customer demand? Or was that done command and control style based on assumptions.

You can defend John, I have no problem. But I will defend against statements like "LSS is (by far) the best methodology to improve." That is speculation too.

Tripp, you never address the

Tripp, you never address the question at hand. My point was that Raissa had ZERO proof that what she saw in the store was the *result* of lean. What she experienced was likely a pre-lean current state. I've never speculated that "LSS is (by far" the best methodology to improve. You notice I spend very little time (none really) attacking "new systems thinking". You are the one, like Raissa, making wild claims based on your limited experience. People likely take it as such. I wouldn't stick my neck out of my prairie dog den if you'd quit your blanket attacks against lean, a methodology that is working well in many places. "Failure demand." See, I can say it too.

"Lean Six Sigma is by Far the Best Methodology"

I am seeing this (the above quote) more and more which prompted the article. There are differences between LSS and systems thinking. Let the readers find out for themselves. I am giving people an alternative that is worth exploring. I stated some of the reasons, if they resonate people will want to learn more.

The Children are Fighting Again

Man ... this gets so old. It starts to remind me of the schisms in Protestantism.

Between the rabid true believers and marketing hype, we all spend too much time poking our fingers in each others eyes. As Bruce Lee was known to say ... if something is effective, use it ... who cares where it came from or what it is called? The truly informed professional learns about all the tools and approaches and then, like a good crafts(person), uses the most effective tool for the job at hand. Who cares if the tool is marked Craftsman or Snap-On?

Put your dogma down ... and step away.


"... as processes such as copying, best practices, and benchmarking do not help organizations improve." Quite a statement. I would love to see the evidence supporting this.
Whether you are a manufacturing or service organization, learning from how others do things is one of the most effective ways to identify improvements for your system. An emergency room can learn from a crew working a Schooner, a pubic school can learn from a private school (and vise versa), the logistics arm of a company can learn from the way the military deploy their defense forces.

Benchmarks, Best Practices, etc.

If we start from the premise that all systems are different - than the benefit would be that benchmarks, best practices, etc could only spark an idea. I find that such things actually lead to assumptions and copying. Our competitor is doing it, it must be good. Then we learn the competitor is losing money on the best practice or that their system is indeed different by culture, work design, customer demands, management, etc.

If perfection is the pursuit, then why do I need to benchmark against a competitor? His system is different as noted above. "Yes, we are behind (or ahead)" This gives no knowledge to improve - it is more results measures that aid in more management dysfunction. Gap analysis studies are kicked off, etc. The biggest benchmarking study was that of Japan manufacturing. Many came back with JIT, quality circles, etc as the answer to bridge the gap - all wrong-headed, but well-intended. Copying will always leave you behind to catch up.

Instead be the company that is truly unique and let others benchmark you.

Is it always about the GURU wars?


Are systems thinking and LSS are mutually exclusive? It seems to me you have built a straw-man argument around the symptoms and results of poorly executed implementations of the concepts of Lean and Six Sigma and have torn it down using the very principles of the men whose contributions made them possible.

I have read "Freedom from Command and Control" and can find nothing substantially objectionable except Seddon’s claims that the Vanguard Method is wholly different than any other improvement “methodology”. If what he wishes to convey is that many vendors and poorly trained practitioners of Lean and Six Sigma have moved substantially away from the principles of the likes of Crosby, Deming, Juran & Ohno, then we are in agreement. The first point in Deming's System of Profound Knowledge is the "appreciation of a system", and that it starts with leadership. From this perspective, real change (improvement) is impossible without the active commitment and support of those who own the system and, thus, “systems thinking”.

Regarding the characterization of Lean & Six Sigma as prescribed sets of "tools"- I must disagree. Consider the argument that LSS is a culture, infrastructure, (set of) methodologies, and metric. Both Lean and Six Sigma are first based on a philosophy, not tools.

Lean starts with 5 Principles (all of which are clearly analogous to the concepts promoted by the Vanguard Method)

1. Specify value from the perspective of the ultimate customer
2. Identify the value stream (the “system” that provides value &/or waste)
3. Create flow to reduce batch size and work in progress (could be read “get the value to the customer as directly as possible)
4. Make only what the customer has ordered (do only valued work)
5. Seek perfection by continuously improving quality and eliminating waste

Six Sigma is based on the philosophy (or physical reality) that all systems have variation and that all variation can be continuously reduced. Thus, it is focused on reducing defects and variation in the output of the system (that which the customer considers valuable). This is achieved through a disciplined (not rigid) approach to continuously identify sources of variation and defects in order to reduce/eliminate them.

Seddon, in his book, distinguishes the Vanguard Method from SS by suggesting that service centers need to absorb variation, not seek to compartmentalize or eliminate it. However, I think this perspective is primarily an issue of semantics, and depends entirely on how one views the system and work. For example, one of the case studies in the text includes (as a solution) placing the “expert” at the front of the line to handle the difficult calls rather than at the back of the line where less experienced staff must escalate calls. He even emphasizes that doing so quickly increased the knowledge base of the other staff members so that they could also handle these calls. I could argue that the Vanguard solution identified sources of variation and defects (both the path of the calls routed to the “expert” and the various possible actions taken by staff with varying levels of knowledge), and reduced them by eliminating the routing and bringing every staff member to the same level of knowledge (and at the same time removed barriers to flow – getting value to the customer more directly).

You have identified yourself as a “reformed” Master Black Belt. That may be for good reason, but to dismiss Lean and Six Sigma off hand, declaring them to be different from and mutually exclusive of “systems thinking”, I think represents a narrow perspective and neglects the underlying philosophy of each. If I’m wrong – help me understand your perspective.

Maybe it's just because I'm not selling anything.


Have practitioners moved away from Deming and Ohno? Yep. Does it apply to all practitioners? No, but the original influence of Deming and Ohno has eroded with time. Too much of the system of profound knowledge (and before that the 14 points) left by Deming have ever been addressed in US organizations. Somehow we equate capitalism with merit-based capitalism, I am yet to find good in the merit/extrinsic motivation approach of service organizations and have seen much damage. To achieve any real improvement management has to change too and without change from command and control to systems thinking we have little hope for sustainable change.

Applying tools is a form of copying from manufacturing. Do all tools from manufacturing work? No. The blind application of tools without understanding the underlying problem has people misapplying all the time. Some to get a Black Belt, others because they have sought training and that is how they were trained.

There is an elitism associated with the lean six sigma culture and the only real difference is the training on tools that is a source of power for many. "You can't improve without a black belt, a prioritized project and identified savings." This is part of the problem, as management delegates authority to the elite to make improvements. Workers are pestered by finance, technology and other supporting functions that wield bigger budgets and (supposedly) smarter people and now add the black belts to their troubles. We are talking about things Deming railed against. Have you really seen a different structure for LSS? I have not, they seem to teach from the same general manual.

At some level you may be able to say we are talking about the same thing (in reference to your book comment on reducing variation) when we see the result. This is the problem with stories and copying, people see the result . . . not the journey. The journey is different with systems thinking, Ive pointed some of those things out others are hard to put into words . . . you have to experience it.

I first saw Deming talk in the mid-80s, and have been in the improvement business for over 17 years. This is less about the selling except for the ideas at this point.

Copying or Blind Copying?

"This is important, as processes such as copying, best practices, and benchmarking do not help organizations improve. "

I thought you said copying does not help organizations. Now I perceive you to be stating that blind copying does not help. Which is it? Do those that follow the Vangaurd method NEVER copy even after appreciation of the system, understanding variation, etc.? In the Vangaurd method, no innovation and improvement ideas come from outside the defined system? If not, where do they come from? Maybe the confusion is in the operational definition of the verb "to copy?"

"Lean Six Sigma" culture

The "lean culture" is squarely different than the "lean six sigma" culture. Lean has never been about belts and elitism. There's a difference that's worth pointing out.
"You can't improve without a black belt, a prioritized project and identified savings."
This is a "six sigma" mindset. If someone has pulled that into a "lean sigma" world, I don't like that.
By the way, if anyone from Quality Digest is reading this, your comments system is the worst ever. New comments seem to appear in random order and the "captcha" system often doesn't work. Not much "quality" there.

Systems Thinking Saves Service- Let's be positive

I tend to agree with Mark, technically, but understand Tripp's frustration with the way many are implementing Lean. Those of us in the continuous improvement arena need to carefully consider the consequences of infighting over details and miss the big picture. I believe there is a danger in disparging Lean Six Sigma in an effort to improve the way individuals and organizations implement systems thinking and approches. It can become an internal debate equivalent to the number of angels that can dance on the head of a pin. I believe we can address the failings of individuals and organizations to fully embrace the systems approach by talking positively about how to effectively implement systematic management. All of us should strive to "stand on the shoulders of giants" to further progress, rather than tearing each other down. Disparaging Lean Six Sigma runs the risk of disparaging systematic management approaches outright, giving those looking for an excuse to stay with their ineffective and inefficient Command and Control methods a reason to do so.

The Big Picture

Thanks, Charles. Well said.

Why is it always "I'm right - you're an idiot".

Wrong definition of Lean


I'm glad you are no longer practicing "Lean" as you were clearly doing it wrong.

If you were just implementing tools, focusing on efficiency over effectiveness, and just doing projects, that's not lean.

You continually define "lean" as this self-serving straw man that only "systems thinking" can address. Hogwash.

There are countless organizations out there, in manufacturing and healthcare, that are transforming their culture, and management systems, and thinking. They are becoming effective by engaging everyone in reducing waste and providing the right value to the customers and patients. And they are practicing "kaizen" every day, it's not just a bunch of projects.

Please don't extrapolate how you apparently did "lean" with those who are doing it right and what they're doing. Go visit a hospital like Seattle Children's or ThedaCare and try to tell them that lean doesn't apply and that it doesn't work. Adapting lean to services does not mean "treating it like manufacturing."

If people are sub-optimizing and only focusing on tools, you are right to call them out on that. But what they're doing isn't lean. It's L.A.M.E.

Mark Graban

LAME is the new normal


I read your book . . . it starts with standardization, not demand. I understand it took years to get lean to finally work (per Dr. Berwick and Jim Womack). Systems thinking doesn't take years and the approach is different. Lean as has been defined by the industrial tourists is not Ohno either. Write what you want, but the difference is undeniable. No kaizen events, no tools, etc.

Oh, and part of my training in Lean came from the group the industrial tourists represent. So, if it is not lean, why do they focus on tools?



Tripp - Unless I see a picture of you holding my book, I still won't believe you have read it. Even then, I would doubt you actually got beyond the pages you color in.

My book does not start with standardization. It starts with purpose, culture, and patient needs. Where we disagree is on the definition of standardization. Your straw man defines it as inflexible, unthinking and robotic. My book defines it very differently. Standardization is saving lives in healthcare, the evidence and data prove this.

What say you about this "systems thinking" failure in New Zealand? By your failed logic, if there's a failure, it's a problem inherent in the methodology.


The so-called "systems thinking" implementation was reported as short-term thinking tools. Way to go, systems thinking.

Your training came from where?


CEOs come and go

If you notice, the new leader came in. New CEOs have their own agendas and most come from command and control backgrounds. The fact they are keeping systems thinking should be viewed as a positive.

mixed response is not failure

Some more evidence: http://www.thesystemsthinkingreview.co.uk/index.php?pg=18&utwkstoryid=44 - and it makes me think about overcoming problems as part of learning.

Could Mark provide a reference to his book? I'm always keen to learn more.


Tripp has previously

Tripp has previously characterized anything other than 100% success of Lean as an inherent failure of Lean. That's his standard, so I'm assuming he'd apply it to "new systems thinking." The curious thing missing from his website, though, is any success stories or anything other than theory about how systems thinking "would" help an organization.

I won't post a link to my book, but you can google me and you'll find it.

Mark Graban

Not True

It was lean folks that said systems thinking is lean done right. There are plenty of stories at www.thesystemsthinkingreview.com and in the books. The important point is that stories leads to copying and a systems thinker knows that copying is not a good idea. Each service organization can write their own story.