Lean Enterprise

Part I. Orient

The purpose of an organization is to enable ordinary human beings to do extraordinary things.

Peter Drucker

Shareholder value is the dumbest idea in the world…[it is] a result, not a strategy…Your main constituencies are your employees, your customers, and your products.¹

Jack Welch

We begin by offering our definition of an enterprise: “a complex, adaptive system composed of people who share a common purpose.” We thus include non-profits and public sector companies as well as corporations. We will go into more detail on complex, adaptive systems in Chapter 1. However, the idea of a common purpose known to all employees is essential to the success of an enterprise. A company’s purpose is different from its vision statement (which describes what an organization aspires to become) and its mission (which describes the business the organization is in). Graham Kenny, managing director of consultancy Strategic Factors, describes the purpose of an organization as what it does for someone else, “putting managers and employees in customers’ shoes.”² He cites as examples the Kellogg food company (“Nourishing families so they can flourish and thrive”) and the insurance company IAG (“To help people manage risk and recover from the hardship of unexpected loss”), to which we add our favorite example: SpaceX, “founded in 2002 by Elon Musk to revolutionize space transportation and ultimately make it possible for people to live on other planets.”³

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