I am always amazed at what improvement potential there is for organisations, even profitable and well established ones. There is a perception that they are well down their "Lean" Journey and have made significant improvements, whether it be through technology or process development. Organisations are rarely as well developed as they think they are, so of course this breeds complacency. Maintaining the improvement "hunger" is a real challenge in large companies. This can be a combination of factors, such as regular leadership changes or collegiate type cultures where there can be a loss of direction.
So what is the critical success factor for continuous improvement? The answer of "Employee Engagement" may sound obvious, but it always rings true and is never at the position large companies think it really is. Not having proper employee engagement is one of the classical lean 8 wastes. So why is this element so critical? Having everyone energised and reaching all levels of the organisation will reap the rewards for a number of reasons. Engagement drives individual and collective passion, which makes a workforce receptive to improvement and change. It also aids lateral communication, which supports idea sharing and innovation. Matrix organisations can support better engagement, but can have the detractor of being overly democratic. This in turn can stifle direction and also lead to "initiative overload", whereby staff can be working on too many improvement initiatives. I have seen this first hand, where the workforce can become confused. I have also seen very hierarchical organisations where communications are filtered or lost vertically, and staff feel less inclined to communicate laterally. This is clearly not a productive place to be, with creativity potentially stifled.
Whatever the company culture or business structure, little or no employee engagement is very harmful. It comes down to the basics - an energised and engaged workforce gives you "Critical Mass" which will support a continuous improvement culture in a sustainable way, even if you have to make structural changes for good business reasons. It becomes the bedrock, even with business headwinds.
In my experience, it is the first job of a senior leader to fully understand the prevailing culture of their organisation, and the levels of employee engagement, before embarking on any initiative. This gives the leadership the opportunity to turn a good organisation into a great one. One useful reference point for understanding the prevailing culture of an organisation is the work that has been done by the Hofstede Institute on cultural dimensions. This can give some great insights and I have used these to illustrate points during consulting, and while lecturing on an MBA Programme.