Speaker 1: You're listening to the Sales Process Excellence podcast with Michael Webb.
Michael Webb: B2B sales and marketing works to find the highest quality prospects, reach decision makers and sell value. Operational excellence uses data and systems thinking to make changes that cause improvement and eliminate waste.
Michael Webb: My name is Michael Webb, and this is the Sales Process Excellence podcast. In the next 30 to 40 minutes, we're going to destroy the myth that these two groups conflict and show you how to bring both strategies together to create more wealth for your company and your customers.
Michael Webb: Hello, this is Michael Webb, and I am excited today to introduce you to someone I've known for a number of years. His name is Cliff Ransom. Cliff holds a very unique position in the industry. I'll let him give you his background, but he has this unique position between the investor relations and management community and the lean community. And what we're going to talk about today, I think is going to be illuminating and quite interesting, especially for the senior executives in the audience. So Cliff, welcome here.
Cliff Ransom: Thank you very much, Mike. It's fun to be here.
Michael Webb: Yes. Yes, we're going to have some fun today. So, if you could give 30 seconds or a minute for the audience so they can kind of get the idea of where you've come from and where you've been and what you're doing now.
Cliff Ransom: I'm going to try to put 47 years into 60 seconds. Here we go. I've been in the investment business, almost exclusively, with institutional investors for 47 years. Almost 30 years ago, I became deeply involved with Danaher, which became my prototype investment and my prototype corporate mentality. I have a very unusual, I can't say unique, but unusual business model, and then I have three legs on my stool. One is 47 years of connection support for learning from institutional investors, portfolio managers, analysts, at some of the biggest and best firms in the world, quite frankly. The second leg is that I have very consciously built a deep presence in the lean community. That includes practitioners, the authors, the consultants, gurus like yourself who have very specialized knowledge of lean applications. And then perhaps most importantly, I've worked with several generations of C-suite corporate leaders, and they understand what it is that I do and make sure that I get the access that I need to learn, because I learned by going to the Gemba; going to the place where the real work is done. And we can elaborate on that later if you'd like, but that's, in essence, what I'm doing today.
Cliff Ransom: For the last 15 years, I've run Ransom Research Inc., which works with a deliberately constrained group of senior investors, because they're the guys who can afford me. And they want me to exercise those three legs of that stool. And I think, in a nutshell, that's about as close as I can get.
Michael Webb: Okay, super. So, obviously you're on a first-name basis with senior executives at the Shingo Institute, at the Lean Enterprise Institute, and a number of corporations.
Michael Webb: Tell me about why you think the senior executives don't quite realize the power of lean, because I agree with you, but it's hard to describe.
Cliff Ransom: Everything you ever say in this business, you're changing constantly. There's a webinar or up on the LEI site that I've been trying to get them to take down for 15 years because I say, "Guys, I don't believe any of that stuff anymore." This continuous improvement has to be applied to your intellectual thinking, as well. In the '90s, I counted the number of Kaizens. That's how simple-minded I was.
Michael Webb: Yeah.
Cliff Ransom: And that was way before I understood that what Kaizens you did are really indicative. They pertain to how you think about lean. You can do 10,000 Kaizens and have a minuscule benefit. They'll all benefit, but minusculely. Or you can do three things that have a profound change on your employees, your customers, your suppliers, yourself. I became quite adamant that this had to be a cultural transformation because particularly as an investor, the last thing I want you to do is to start on this course of action, start in collocating these mindsets, and then give up on them, because you'll only confuse your employees, your suppliers, your shareholders, your regulators. It's the worst thing you can do, is to start and then kill it.
Cliff Ransom: I was the Chairman of the Board of Shingo, so I love the Shingo Model. I used to get in trouble with the professional staff because they would ask me to give speeches all around the country, all over the world. I would say, “I don’t give a damn whether you ever apply for the Shingo Prize, I just want you to live by the Shingo Model. And I think everybody should understand the model.” And then the staff would turn to me and say, “Uh Cliff, you know we make our money by helping people apply for the prize.” I would say, “Yeah, yeah, yeah.”
Cliff Ransom: It’s like a friend of mine I ran into on the street this morning and she said, “We were one of the 12 finalists for the Deming Prize. We got interviewed and we just missed it.” I said to her, “Good” and she looked at me with a stricken look, she works at a hospital. And I said, “The Deming Prize is not what you want to do. What you want to do is live up to the Deming Philosophy. That’s what you want.” She said, “Okay, okay, I get it, I get it, I get it.” I said, “If you want me to come out to chat with your folks about why that is an important distinction, I will be happy to do it.”
Michael Webb: So to me, this is about helping companies learn to think more critically. All the people inside the company need to be enrolled in that effort. And most especially, the senior people. They have to lead it by how they ask questions, how they respect the accomplishments and failures of the people who work for them.
Cliff Ransom: You know, you talk about inquiring minds; an inquiring mind, by definition, requires the willingness to listen to alternative VCs, to gather data. Toyota says the data will speak to you, but you have to do it with an intention. I was working with LEI, they were doing sort of one of these CEO seminars. By the way, nobody in the lean business has yet broken the code on how to get CEOs to go to seminars. But I said, "You know, John," to John Shook, who's ... Been a dozen people who have been incredibly patient and generous and giving of their time and sensibilities to me, and Shook's one of them. I said, "You know, John, this business about asking questions really comes hard to me. My line is humility does not come easily to me. The idea of asking questions rather than barking orders; I always succeeded in life from the military on up by ... " You know, they'd say, "Take the hill," I'd go take the hill. I might hire a bunch of North Korean mercenaries to do it, but I wouldn't tell them that until I had the flag up there.
Cliff Ransom: But I said, "Just asking questions is hard." I said, "But I'm really working at it. I'm really trying to do it." And he said, "Yes." He didn't quite say, "Wax on, wax off, little grasshopper," but he said, "Yes, Cliff, I can tell you're w...
