Stenzel (94) holds that enterprise excellence is not only dependent on the tangible assets which are the focus of accounting practices. Human assets are part of the resource in an organization that contribute to the excellence of the enterprise. The concept of employee competence is important in lean performance. Stenzel (94) illustrates this argument by citing the financial turnaround at Sears following the huge financial losses that the company suffered in the 1990s as a result of focus on the development of employee competencies. Employees who are highly competent can perform their responsibilities with more effectiveness. The resultant effect is a better customer relationship management and a cohesive work process (Stenzel 94).
A commitment to participation, performance improvement, and employee competence are some of the tenets of lean excellence (Stenzel 94). This argument links enterprise excellence to the people or the employees working in an organization. The lean accounting measures used to ensure enterprise excellence are geared towards maximizing the competencies, skills, and performance of the employees. This allows the employees apply the competencies, experience, skills, and knowledge they have towards value redefinition (Stenzel 94).
The value of people toward enterprise excellence is also illustrated by the evolution of organizational strategies. Stenzel (95) reports that organizations are reducing their supply base by over 70% in order to reduce maintenance costs. However, they maintain a steady supply by exploiting employee competence. Competent employees are able to build supplier networks that enable flexibility in the acquisition of materials, product development, and customer relationships.
Innovation and People
Stenzel (96) finds that with regards to innovation and people, traditional enterprises motivate their employees to work harder while lean enterprises motivate their employees to engage in innovation and continuous improvement of the product and services. The differences in the outlook of the two enterprises are that unlike the traditional enterprises, the focus of lean enterprises on the elimination of wastes through innovation and creativity as well as value addition.
The concept of ownership with regards to processes and decisions is also applied by lean organizations to encourage innovation and creativity. When employees enjoy autonomy to make decisions, Stenzel (97) finds that they are more motivated to implement new approaches, alter their operational mechanisms, and also seek information so as to improve their performance. Stenzel (97) also reports that autonomy encourages creativity and innovation, especially when the ideas generated from the creative and innovative efforts of the employees are recognized by the organization. The centralization of decision making stifles creativity while decentralized power enhances involvement, awareness, and innovation (Stenzel 98).
Empowerment and motivation are important in the pursuit of enterprise excellence. Empowerment and motivation are important in molding the thinking philosophies of employees. Consequently, traditional-thinking employees have a different philosophy from lean-thinking employees (Stenzel 101). Stenzel (101) reports that as a result of empowerment and motivation, lean-thinking employees are inclined towards actively contributing towards the organizational goals, are trained to deliver effectively across different scenarios, have the autonomy to make decisions, work in interdisciplinary teams, and have access to the information required to make decisions.
The traditional-thinking employees work as individuals, require roles and responsibilities that are defined narrowly, require supervision around the clock, will not intrinsically apply effort to meet organizational goals, need extrinsic motivation, and are perceived as expenses of the organization (Stenzel 101).
Empowerment and motivation are perceived different in lean organizations and traditional organizations. As discussed above, the motivation is extrinsic in traditional organizations and intrinsic in lean enterprises. The regard of employees as assets in lean enterprises makes the enterprise invest resources in training, capacity building and empowerment so as to improve their effectiveness (Maskell & Baggaley 41 and Stenzel 102).
Empowerment and Perception
Although autonomy in decision-making is an important tenet of lean organizations, enterprise excellence is dependent on much more that allowing autonomy. The employees need to be empowered with effective decision-making (Stenzel 103). Stenzel (104) also holds that in additional to give the authority to make decisions for the employees, they need to feel that the organization will benefit from the decisions they make. As such, the employees need to have confidence in their competencies. It is also important that the confidence is not just in the individual competencies, but also the collective competence of the team (Stenzel 104).
The perception of the employee regarding authority in decision making is arguably more important than that of the employer. Stenzel (104) holds that it is different when the employees feel that they have the autonomy to make and implement decision from when the management tells them that they have the autonomy. The difference in the two scenarios is reflected in the performance of the employee and the enterprise. In this aspect, differences between lean and traditional organizations is very apparent. In traditional organization, the concept of autonomy is an illusion while in lean organizations, it is overtly perceived by the employees and serves as a motivating factor (Chiarini & Vagnoni 284).
The aspect of perception also relates to the how the employees perceive their contribution as well as their value to the organization. Stenzel (106) argues on a basic but effective level when he states that all people have an inherent need to be valued as well as feel their endeavors contribute to something bigger. Organizations communicate the value and contributions of the employees through performance evaluation (Stenzel 106).
Accounting, Lean Performance, and the Empowered Work Force
The three concepts are intertwined and enable one another. The accounting role in the lean organizations is different from what it used to be in traditional organizations. Accounting is much more than the tangible assets. In lean organizations, accountants are tasked with ensuring the process ownership. In lean accounting, the process entails designing performance metrics through which the enterprise and employee performance is measured (Stenzel 114). Unlike in traditional organizations, accounting in lean organizations is not limited to financial years. Sustainability is achieved by focusing on the long-term. Even though accounting has a financial connotation, accountants in lean enterprise work in cross-functional teams.
Chiarini, Andrea and Vagnoni, Emidia. Lean production, job satisfaction and motivation in the Italian manufacturing industry. 2014: DOI 10.7433/SRECP.2014.17Maskell, Brian and Baggaley, Bruce. Lean Accounting: What's It All About? 2005. Web 1 Feb. 2017. www.leanaccountingsummit.com/LeanAccountingDefined-Target.pdf
Stenzel, Joe. Lean Accounting: Best Practices for Sustainable Integration. New York, NY: John Wiley & Sons, 2010. Print.