Build your Lean Transformation with the Flywheel Effect
In 2007, my Managing Director at the time handed me a book. Right in that moment, I didn’t realise the profound effect this book would have on the way I would view business, leadership and improvement in the future. It just looked like any other business book and I had read plenty.
This was no ordinary book. It was Good to Great by Jim Collins, arguably one of the most influential business books of this century, and it was a game changer for me. I am ashamed to say it sat on my shelf for a few months before I picked it up and began what I thought was going to be the heavy chore of reading it. How wrong I was.
Thanks to the research, concept development and teaching of Jim Collins I learned about transformative Level 5 leaders, about getting everyone on the bus, the Hedgehog concept and the subject of today’s post, the Flywheel effect. I can confidently say that Good to Great has had a significant influence on both my management style and understanding of the importance of strategic roadmaps, teams and decision making.
I hadn’t thought about the Flywheel effect in a long time and I suspect I hadn’t really understood the implications of this model as it relates to lean transformations as well as I could have. What sparked my recent revelation was listening to a Tim Ferriss podcast with the great man Jim Collins himself. In it, towards the end of the podcast, they discussed how the Flywheel effect has been applied and improved on by companies like Amazon since it was developed as a model from the research conducted by the Good to Great team.
This got me to thinking about my own current lean transformation. In a few weeks, I’m talking with my leadership team about growing team members in improvement through skills developing and coaching. I have been looking for a way to communicate how far we’ve come and how far we’ve got to go. I’ve also been thinking about how the lean journey starts slow, with many incremental steps that build momentum over time, leading to more improvement and culture development.
This morning, thanks to Tim and Jim, I realised I was trying to describe the Flywheel effect.
Figure 1: My adaptation of the Flywheel Effect diagram in Good to Great by Jim Collins
In an attempt to prove the Flywheel effect existed in my own transformation I started documenting in a table the last few years of lean development at my company in terms of both lead-time reduction and the growth improvement culture. As I wrote down our lean history I could clearly see the Flywheel effect. In the first year we made small but important changes, we dipped our toes in the water. In the following year, we built on our successes from the previous year, got more people involved and saw shorter lead-times and more people involved in improvement. The year after, we made even greater, game changing improvements, more people got involved, our momentum grew as the flywheel started to pick up speed.
Looking back at this and looking forward to our plans for the coming year, it is plain to see that the Flywheel Effect is well and truly proven to be a real phenomenon at our company. Momentum is building, although at the beginning the steps we took seemed infinitesimally small and at times, almost ineffectual.
In Good to Great, Collins discovered that in all the ‘great’ companies there has been “no miracle moment.” On the outside, companies seemed to “breakthrough” but in reality there was a “quiet, deliberate process of figuring out what needed to be done to create the best future results and then simply taking those steps, one after the other, turn by turn of the flywheel.”
This concept is both gratifying and encouraging. Step by step, day after day, improvement after improvement, our company moves towards greatness. I know this to be true, because Jim Collins and his team did years of research to prove it.