INTERVIEW – Today’s story takes us to Iceland, where a senior leader in a utility company introduced cellular thinking to her team in a bid to improve flexibility and better working conditions.

Interviewee: Inga Lind Valsdottir, Managing Director of Technical Development, Veitur – Iceland

Interviewer: Pétur Arason, Founder of the Icelandic Lean Institute and Owner of Manino

Inga Lind Valsdottir is an executive at Veitur, one of Iceland’s biggest utility companies. Late last year, Inga Lind wanted to run an experiment to try and introduce flow efficiency and cellular thinking to her 40-people team, who is responsible for all technical development and projects (electricity- and water distribution systems, district heating and wastewater). They have between 150 and 200 ongoing projects at any given time, with a turnover of around €60 million.

The team is a mix of engineers, who design and develop the different solutions, project managers, who run the projects, and field experts who work at and overlook the projects during the execution phase. Their original set-up was traditional, based on functions (in other cases, it is often departments): each group of specialists – engineers, project managers, and field experts – sitting and working together. Projects would begin at a startup meeting, where project managers took ownership, and then flow through the functional teams.

Conversely, when we implement cellular thinking, we are focusing on value that is being created (products or services) rather than on the nature of the knowledge of the individual performing the work. This way, we can create autonomous teams capable of running the project from cradle to grave – resulting in more flow, better prioritization, less burn-out for workers and (particularly important at a time of crisis like this) more flexibility for the business.

We decided to sit down with Inga Lind and ask her about the changes she and her people have been working on for the past few months.

Pétur Arason: Why were you thinking of changes?

Inga Lind Valsdottir: The cooperation between the three functional teams was generally very good, but we were experiencing the common “silo effect”. People would think about their part of the project independently and then pass it on to the next step. Everybody was doing their bit and doing it well, but behind the seemingly good atmosphere we struggled with heavy workload for individual workers, recurring mistakes and the occasional conflict.  We couldn’t feed the experience from the field back into the design process, and tension between the functions appeared periodically.

After a short brainstorm session with our coach from Manino, we decided to go ahead with an experiment. It was not exactly clear where it would all end, but we knew this would be a learning journey focusing on the insights and ideas coming from all employees.

PA: What did you decide to do?

ILV: We wanted to increase happiness and decrease workload. It was clear we had to first work on our personal connections and build trust. We therefore decided to run an experiment: to create cross-functional teams instead of relying on a functional setup. To do that we needed to define the main categories of projects that we were running and create five different teams. We would then place the needed capabilities into each team based on the value we needed to deliver to the customer, rather than our own expertise. This approach is typically referred to as cellular thinking and is well known in manufacturing (among other environment).

Manino helped us at the beginning to educate all employees on cellular thinking and how we could create a human communication system with a daily takt time. We knew that, if we were to succeed, we needed to have everyone on board: that means giving everyone a chance to put their fingerprints (ideas, concerns, etc.) on the outcome. The management team was very humble in their approach and, even though the change itself was mandatory, we gave the employees full freedom on how to execute it – which is important as you try to build trust, a key ingredient in any transformation. Two short workshops were conducted to bring people together around these new ideas and create a shared vision.

PA: What challenges did you meet before getting started?

ILV: This was a huge change for the team. People were committing to work with new colleagues and new types of projects on a daily basis. On top of that, we were changing the layout of our workplace, which meant everyone had to move (that alone can be a big change). We also faced the enormous challenge of building trust and personal connections between new team members. We all knew each other before the change, but now we wanted to work more closely together and in a different way.

PA: How did you execute all this?

ILV: When we started the new game plan in December 2019, we already had been preparing for eight weeks. The main idea was that the group would make the most important decisions on the changes to implement together (for example, what roles should be present in a cell).

To decide who would be in each cell, we simply put a poster up on a wall with the name of the cells and its roles and asked everyone to put their names under the cell they wanted to join. This flowed very naturally and there was no pressure from the management team. (Out of 40 people, only one had to accept to join a cell that was his second choice.) That’s when we realized how easy things could get if we gave people the freedom to choose for themselves.

The changes to the layout were also surprisingly easy, even though we are still adjusting it. A lot of unnecessary office furniture was removed, as the cells wanted to operate in an open and easily accessible environment. Today, we have six cells and most of them are made of two project managers, two designers and two field experts. The cells focus on projects aimed at specific geographical areas or types of technology needed by the customer.

PA: How is the communication in the cells?

ILV: We started by creating personal connections and establishing trust by arranging daily 15-minute meetings in each cell, in front of a white board where all projects, their status and ongoing tasks are visible. We always discuss how we feel. Whenever someone was not ready to open up about their feelings, we focused on their workload instead. This creates an opportunity for cell mates to show compassion and offer help whenever possible.

Our projects flow much better and communication is now on a totally different level in the teams. People are closer to one another than before and that alone results in improved service for our customers. We are on top of things, we take better decisions and we have improved our responsiveness.

PA: How did this experiment impact the workplace?

ILV: It was surprising to see how much this actually influenced us. Personal connections are extremely important. Team members are now arranging events, at work and outside – from Tuesday yoga to going bowling together. People are also helping one another more, looking out for each other so that work can be left at work without worry (they know they are not alone and that their team will help if necessary). We have created a more humane workplace. Because everyone has a clear understanding of the process and its status, we no longer need to replace a team member who is absent for whatever reason: the rest of the team can fill in them. By discussing the projects together, teams can also make collective decisions on what projects to pause while others get finished, which has helped a lot with our workload management. We have been talking a lot about one-piece flow and the waste associated with multitasking – like switching from one project to another all the time. Helping our other team members also resulted in some great examples of cross-training.

In February, during one of our meetings, we asked people to share their feedback on the overall change process and we received all kinds of wonderful comments showing how people really felt about the change.

PA: In hindsight, what were the biggest challenges?

ILV: We started out with a lot of positive energy, but soon realized this is no walk in the park. It is not easy to make new ways of working stick and become part of a company’s culture. That’s a huge challenge for us. Some of the teams excelled and had made their changes sustainable after just a couple weeks, while others needed more support.

It is important we are aware of the concerns our people have. Different people respond to change in different ways. Whenever we experienced resistance, we had personal discussions with people and listened to their worries and ideas. One concern, for example, was related to functional knowledge: “If designers are not together day in day out, what will happen to our technical knowledge?” people would tell us. In response, we reassured them they’d have a platform to meet, share and develop their knowledge. This, of course, applies to the other functional groups as well.

Another challenge was the grey area that appeared as we implemented changes and a lot of projects didn’t have a dedicated cell (they were run by members of different cells instead). These were often projects in their final stages, which people wanted to close even though they did not belong to their new cell. This created some confusion in the first few weeks. A recent example of a challenge with the new cell-based structure is that the variety of projects each individual works on has decreased as the cells have all developed a well-defined customer focus. This gives us a chance to review how we define the cells and how their focus is determined.

PA: What have these changes meant in the current situation of COVID-19?

ILV: I cannot even think of how we could have coped with this unprecedented situation if we had not made this move to cells. Everyone is currently starting their working day at home with their cell at 8:45 for a 15-minute daily meeting in Teams. People have been trying to maintain all their daily working rituals, including virtual coffee breaks. They even ask each other to stand up occasionally and go out for a walk together. It would be interesting to know how many meetings we would have needed to keep the operation alive in the old setup, where one project manager could easily have had 10 projects ongoing (and therefore 10 designers to work with). It’s almost scary to think about it!

PA: What advice would you give other leaders?

ILV: I would encourage them to run experiments, but only if they are willing to really involve their people in the process. That will always create better results in the long run.

_{THE INTERVIEWEE}

_{THE INTERVIEWER}