Valuing People Development and AI Integration

Insights from November's Virtual Lean Coffee

"I don't have the answer. Ideally, we would just develop people and not worry about if there's ROI on it. But for the less enlightened people who are out in the world, they're still looking for how do you measure, calculate? How can I justify spending time developing my people?"

This question cut straight to a challenge that lean practitioners face daily: proving the value of investing in people when financial spreadsheets demand immediate, quantifiable returns.

On November 12th, the Central Coast Virtual Lean Coffee community gathered online to wrestle with this persistent puzzle alongside other pressing questions about terminology and artificial intelligence. With participants spanning from California to Colorado, from healthcare to manufacturing, the conversation revealed both complexity and practical pathways forward.

The ROI Dilemma: From Philosophical to Practical

The human development ROI question earned seven votes, dominating the session. One participant opened by referencing Mike Rother's response when asked if implementing Toyota Kata would improve profit: "No, not directly. Toyota Kata is a way of developing scientific thinking skills that will make you better at moving toward whatever your goal is, but just practicing Toyota Kata is not going to improve your profit. If you want to improve profit, it'll make you better at pursuing that."

This reframing—from "will this make money?" to "will this build capability?"—shifted the trajectory. Another participant introduced a compelling counterfactual approach from Veterans Benefits Administration work: comparing who someone becomes with training versus without it across parallel universes. The approach offers power but becomes "a minefield" when multiple stakeholders claim the same ROI for their bonuses.

The conversation surfaced several practical frameworks. One participant urged alignment with specific Hoshin Kanri objectives rather than defending abstract ROI formulas. Another highlighted value stream thinking: eliminating handoffs through cross-training and reducing unnecessary meetings through increased confidence creates quantifiable returns.

Cross-training matrices emerged as a tangible measurement tool—scoring team members' capabilities across essential skills on a 1-3 scale, then tracking the table's total score over time. This quantifies capability growth even for soft skills when team members self-score with peer accountability.

Perhaps most provocatively, one participant challenged the premise entirely: "People are not an expense. They're more like capital. So where you should be focusing on is what is your output, what's your flow? And spend your time monitoring that, rather than wasting your time trying to monitor how proficient a person is."

If organizations truly viewed people as assets rather than costs, the ROI question transforms fundamentally.

Is "Transformation" Just Another Name for Lean?

The terminology discussion revealed fascinating sector-specific patterns. Technology communities embraced "transformation" 15 years ago, then rejected it after failed implementations. Healthcare has cycled through "management engineering," "lean," and now "operational excellence"—one survey finding 53 different labels for improvement work.

One participant captured the concern about "transformation" perfectly: it suggests a one-and-done project where you "take bad company and make bad company good company, transform it, and then we don't have to worry about bad company anymore."

Yet "lean" persists. As one participant observed, despite being "a lousy word," lean has proven "pretty resilient" as a "best practices magnet"—loose enough to absorb useful methods regardless of original packaging. Another participant synthesized beautifully: "I think of lean as the English language equivalent of improvement processes. English takes words from everybody. And Lean does the same."

The insight? Words matter less than substance. Focus on actual improvement work rather than labels.

Building Shared Knowledge Through AI

Multiple facilitators are experimenting with converting lean coffee transcripts into searchable knowledge bases. The motivation: creating narrative story formats that preserve diverse perspectives rather than having "just one person control the narrative."

This work carries significance beyond the immediate community. When published to websites, these conversations become part of the body of knowledge that search engines and AI systems help us navigate. What once required searching for obscure academic theses now becomes accessible through blog posts and articles. The content provides near-term benefits—improving validity, spurring discussion, catalyzing networking—while creating lasting value for future practitioners discovering these insights years later.

One innovation from Tom Yusu's "Improvement Starts With I" WhatsApp group demonstrates the potential: feeding two years of chat history into ChatGPT, then querying it for insights, SWOT analyses, or even 360-degree feedback based on participants' contributions.

The Colorado Lean Network is taking this further by adding academic validation. Their approach: "For all topics discussed during this session, identify peer-reviewed, university-backed publications that either support or conflict with the narrative within the discussion released within the last five years." This balances "practical validity—most practitioners agree this is true" with connections to evidence-based literature, avoiding consulting firm marketing while expanding the conversation through tangentially related research.

The ultimate vision: comprehensive knowledge bases where anyone can query collective wisdom on topics like "5S in service industries" while pulling in evidence-based literature. The challenge: balancing accessibility with privacy and creating systems that serve communities rather than just individuals.

Automation versus Autonomation: The AI Integration Framework

AI adoption faces multifaceted resistance. Cal Poly students push back on ethical grounds even when instructors mandate use. University lawyers block grants citing unknown risks. A state agency quickly withdrew Microsoft Copilot after employees inappropriately entered confidential child welfare information.

Yet blanket rejection misses beneficial applications. One educator emphasized teaching critical thinking about prompts and evaluation of outputs rather than prohibition. Another drew parallels to Wikipedia's evolution—initially distrusted, now credible through strong governance. AI currently lacks that overarching body ensuring good processes.

The most useful framework came from Toyota Production System principles: "automation versus autonomation. Automation is when you hand everything over to the machine. And autonomation is when you use the machine as an assistant to what you do."

Real applications demonstrate this distinction. Art Smalley's Lean AI coach doesn't write A3s—it critiques yours, coaching you to dig deeper. One consultant used AI to synthesize lean operating system literature, then scaled coaching from one-to-one to one-to-five with AI handling first-pass reviews. An innovative school achieves 10x faster learning with AI coaches that require prerequisite work before providing guidance.

One software engineer even taught AI to write A3s about its own failures, using lean problem-solving to improve the AI system itself.

The pattern? Prerequisite human work, critical evaluation of outputs, and maintaining human connection for coaching and relationships.

Finding the Balance

As one participant reflected on evolving from three hours of 1990s library research to 20 minutes with early digital tools to 20 seconds with current AI: "As long as I'm the one in charge, I think it's going to do better."

That human agency—staying in the driver's seat while leveraging powerful tools—captures the essential balance.

For measuring people development: align investments with organizational objectives, use tangible tools like cross-training matrices, consider counterfactual long-term thinking, and examine whether your organization treats people as expenses or assets.

For AI integration: follow the autonomation principle—augment human capability rather than replace human judgment. Require prerequisite work, critically evaluate outputs, and preserve human connection where it matters most.

The lean community continues learning together, experimenting thoughtfully, and sharing discoveries that benefit everyone navigating these challenges.

Knowledge Map: Connecting to Your Context

Process Keywords: ROI calculation, capability development, value stream mapping, cross-training matrix, counterfactual analysis, scientific thinking, knowledge management, prompt engineering, autonomation, organizational learning, evidence-based practice, democratic facilitation

Context Keywords: People development justification, talent retention concerns, training budget allocation, improvement terminology confusion, AI adoption resistance, ethical technology concerns, coaching scalability, privacy boundaries, student learning assessment, legal compliance challenges, organizational capability building, technology governance

Application Triggers:

• Facing budget challenges for training programs → Cross-training matrix quantification approach

• Struggling to justify soft skills development → Counterfactual and value stream connection frameworks

• Debating AI adoption policies → Automation vs autonomation distinction

• Converting meeting notes to shareable knowledge → Transcript-to-blog workflow with AI assistance

• Resisting or mandating AI use → Critical thinking and evaluation skill development focus

• Seeking scalable coaching approaches → Prerequisite work plus AI augmentation model

• Confused about improvement terminology → Focus on substance over labels, recognize contextual evolution

Related Continuous Improvement Themes: Respect for people, scientific thinking development, knowledge management systems, organizational learning architecture, technology adoption strategy, leader standard work, capability building versus cost reduction mindset

Continue the Conversation

Join Our Next Virtual Lean Coffee: Second Wednesday of every month, 10:00-11:30am Pacific Free registration at: https://www.purpose-ccl.org/lean-coffee 

Or simply click the Zoom link to join: https://calpoly.zoom.us/j/215381714

Upcoming Central Coast Lean Events: Toyota Kata Workshop - Friday, January 23, 2026 (virtual and in-person) Details at: https://www.purpose-ccl.org/ccl-events

Read Previous Lean Coffee Blogs: https://www.purpose-ccl.org/blog

Resources Mentioned: 

Art Smalley's Lean AI Coach: https://info.lean.org/leanai 

Colorado Lean Network: Connect with John Newton via LinkedIn 

Tom Yusu's "Improvement Starts With I" community

People to Connect With: 

Scott Gauvin - Respect for People program 

John Newton - Lean Methods Group, Denver 

Steve Pereira - Value stream mapping expertise 

Chris Ferrier - Central Coast Lean co-facilitator 

Eric O. Olsen - Central Coast Lean Director

Become a Blog Editor: Interested in reviewing and commenting on draft blogs before publication? Email Eric O through the Central Coast Lean website to join the editorial team. Quick, comment-based feedback only—no intensive wordsmithing required.

Hashtags: #CentralCoastLean #ContinuousImprovement #LeanThinking #PeopleDevelopment #AIinLean #ToyotaKata #ValueStreamMapping #RespectForPeople #OrganizationalLearning #LeanCoffee

Attribution: This blog post documents the November 12, 2025 Central Coast Virtual Lean Coffee session. Participants included Ruth Archer, Ravi David, Scott Gauvin, Christopher Ferrier, Colin (Atypical Lean), David Belson, Tracy Hopkins, John Newton, Liz Korabek-Emerson, Steve Pereira, Mark, Christian Wandeler, and Josh. Editorial contributions from Christopher Ferrier, John Newton, and Eric O. Olsen improved content accuracy and insights. Content was synthesized from session transcripts with Claude.AI assistance by Eric O. Olsen.

Central Coast Lean is a community-driven initiative dedicated to building stronger lean practice on California's Central Coast and beyond through education, networking, and practical application of continuous improvement principles.