How to Respond to the ‘Great Resignation’

All of us are dealing with labor shortages, directly and indirectly. Customers are waiting longer; employees are working harder. “Scarce labor is becoming a fixture of the U.S. economy,” declares an article in the Wall Street Journal. At the end of September, there were 10.4 million job openings, only slightly off from the peak in July, at just over 11 million. Simultaneously, 4.4 million U.S. workers quit their jobs in September, a record.  

Business leaders are responding with a range of countermeasures. Returning to the same article: “Scarce labor is … prodding firms to adapt by raising wages [great!], reinventing services [a euphemism for ‘offering less value’ — not so great] and investing in automation [okay, but that won’t help today].” [Commentary is mine.]  

Lean thinking, which always starts with the customer’s needs, prompts us to look at how those needs are met, i.e., the work. Moreover, out of respect for the people who give their time and energy to do the work, lean thinking has us define the knowledge and skills, i.e., capability, required to perform the work successfully. And finally, lean thinking has us build a supportive yet challenging management system for the sake of meeting customer needs effectively by enabling every worker to keep improving their work.  

It follows, then, that lean thinkers will notice something missing from the rundown of business leader responses: innovating the work experience. I was reminded of the significance of the work experience, and more fundamentally, the critical importance of the work itself, on a recent visit to a manufacturing company where business is booming, and yet … 

Why Innovate the Work Experience? 

My guide and I started in shipping — as close to the customer as possible. While he pointed out huddle boards and kanban — you know, lean stuff — I watched an operator struggling to build and fill cardboard boxes with finished goods.  

Lean thinkers will notice something missing from the rundown of business leader responses: innovating the work experience

The operator was isolated on a sprawling island of a workstation. Piles of boxes in various shapes and sizes were scattered around. For every box and piece of work, the operator had to go get it. Walking to locate and retrieve correct-sized boxes contributed to the operator falling behind, which led to a growing pile of finished goods waiting to be packaged. Then, when a type of box ran out, the operator had to go get more. As a result, the finished goods pile continued to grow. So the operator picked up the pace, nearly tripping over an improperly parked forklift.  

Just observing was stressful. Frankly, the work was awful. And worse, as all of this was happening, all of these problems, no one was around to help. 

Later, still thinking about the need for kaizen in packaging, I asked about the company’s labor situation. What’s the impact of the labor shortage? Hiring isn’t the problem, I was told. The company offers relatively high wages. Keeping people is the problem. “In fact,” my host said, “someone quit the other day after working only one shift.”  

I thought to myself: If that person’s experience was anything like the packaging operator’s, I understand why. Eight hours of struggling alone, day in and day out, cannot be what potential employees envision. Clearly, things needed to improve. But that’s always true and easy to say. The harder question is, “What is needed to grow and sustain a culture of kaizen?” 

What Does a Good Work Experience Look Like? 

This experience reminded me of the emphasis lean places on the value of a great team leader who constantly helps team members. In a management system built around this concept, team leaders are provided excess capacity, i.e., slack by design (shout out to the Good Jobs Strategy). Having available time enables them to (a) help team members when things go wrong, as they inevitably will, (b) root-cause problem-solve to stop things from going wrong repeatedly, and (c) build problem-solving capabilities in their team.  

When I worked for Starbucks before joining LEI, store managers spent 80% of their time on the floor behind the counter, which meant four out of five days were spent preparing and serving food and drinks. If their heads were up, it was for the sake of interacting with customers, not for monitoring the baristas.  

On the one hand, being so close to and doing the value-creating work gave store managers an intimate familiarity with their customers and the details of the work — both of which help solve problems in the work process. For example, it’s helpful to know what a good cup of coffee tastes like to customers while also knowing the fundamentals of how to prepare good-tasting coffee. Then, when customers say the quality of coffee is bad, store managers can quickly identify potential process adjustments for experimentation. 

On the other hand, store managers had very little time to tackle work-based problems, especially when things got busy. You know, when most problems happen. So, at best, problem-solving would happen well after the point of occurrence. A consequence of this approach is that frontline workers (baristas at Starbucks) got good at living with and working around problems. But, unfortunately, it also meant most problems never got addressed. What I witnessed at the manufacturing company was similar: the packaging operator was stuck dealing with problems in the work process. There was no time or support for kaizen. 

Contrast that with Herman Miller’s “facilitators,” i.e., frontline supervisors. Per the team leader concept, facilitators are responsible for and capable of supporting a handful of frontline workers. And they are set up with the capacity required to do so effectively. Not only that, but they stand mere footsteps from their team members so they can respond quickly — before the end of the work cycle — when help is needed (problem-solving type 1:  “troubleshooting”).  

When not actively helping, team leaders monitor performance, track every single problem, however small, or work through a problem-solving process for a repeating issue (problem-solving type 2: “gap from standard”). Their value-creating work, then, is solving problems. And, by doing so collaboratively with team members, developing them into practical work-based problem solvers.  

Back to the Gemba 

In part, the “great resignation” is employees telling management that they’re sick and tired of the typical work experience. I wish the packaging operator’s experience were abnormal, but I don’t believe that’s true. The good news is kaizen is a proven way to innovate the work. But how to foster a culture of kaizen? I’ll propose that team leaders with capacity are key.  

If you’re struggling to keep people on the job, perhaps run an experiment! Create a team leader role in a particularly problematic area. Ensure they get the knowledge and skills required for effective kaizen. Then, monitor the impact of this rudimentary management system on whether employees will stay, for how long, and with what mindset. Do they keep working around endemic problems? Or do they leverage the team leader to keep making things better? Please let me know.