Art Byrne - The Lean Turnaround: How Business Leaders Use Lean Principles to Create Value and Transform Their Company

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James P. Womack

Art Byrne has learned more about creative change than any CEO I have encounteredmany with big namesover the past 30 years. I know this because I have been following Arts work closely since we first met in the early 1990s when I decided to write about the Wiremold Company in of Lean Thinking.

Art started his management career at General Electric more than 30 years ago, when it was widely perceived to be the best-managed large company in the world. As he recounts in , he soon learned the limits of what we now call modern management, the GE system of managing by results that has become a global norm.

Art then moved to Danaher, which with his help was to become the most consistently successful industrial company of the past 30 years. As group executive overseeing half of the Danaher portfolio of companies, Art played a critical role in making the company successful. He did this by learning from Toyota a new way to manage in which senior leaders took dramatic, direct action to transform core processes. This was codified in the Danaher Business System, which sustains an evergrowing company to this day.

Art then moved to Wiremold, where as CEO he learned how to rapidly transform every element of a large company, gaining knowledge as he went through a remarkable range of experiments conducted at his direction. He began by rethinking value from the standpoint of the customer and asking what leap in performance Wiremold needed in order first to survive (which was in doubt) and then to prosper. This went beyond the usual challenges of cost, quality, and delivery (all of which were successfully addressed) to asking anew about the problems that customers wanted Wiremold to solve.

One fact that became clear to Art almost immediately was that many customers did not want to buy isolated partsthe raceway and fittings needed for a building project. Instead, they wanted someone who could send a complete kitwith perfect quality at just the right timecontaining all the parts needed to wire a scientific laboratory or a hospital or a factory. In addition, they wanted as much of the assembly of these parts as possible done at Wiremold before shipment so that whole wiring systems could be installed quickly, with minimum effort at the site. By rethinking value from the standpoint of the customer and creating new processes to provide this value, Wiremold was able to generate ever-growing sales at high margins in an otherwise stagnant industry.

Today, Art works in private equity, an activity that ought to be a major generator of wealth for society, but that often only shifts wealth from one group to another. Here he has learned how to transform a host of companies simultaneously, as the chair of their boards, in a way that creates more value for customers, stable jobs for employees, and new wealth for owners. In doing this, he has perfected a transformation model that can be followed by any CEO to redefine value and create growth even in depressed economies.

It is remarkable to find an individual who has transformed businesses at every level, from general manager of a business unit to group executive in a multibusiness company to CEO of a major manufacturing company to an operating partner in private equity overseeing a portfolio of companies as their nonexecutive chairman. But what really struck me as remarkable about Art from the day we first met 20 years ago was that he had the gift of making complicated things simple and engaging everyone in an organization in a crusade for dramatic transformation.

When I first entered Arts office at Wiremold in West Hartford, Connecticut, he immediately suggested that we take a walk together through Wiremolds value-creating processes to see a dramatic business turnaround in real time. As we walked, he described a remarkable vision of where he was taking the business by rethinking customer value and transforming the core value-creating processes, running across sales and customer support, product development, purchasing, and operations. I already understood most of what he was telling me from a technical standpoint. It was his ability to describe his turnaround methods in simple terms in the course of a short walkand in a way that every member of the organization could understandthat I had never before experienced.