Dave Gleditsch, Chief Technology Officer, Pelion Systems, makes many excellent points in: Transforming Your Business To Lean: Lessons Learned:

So ofter measures become the focus and the reason for improvement is obscured. Improvement should eliminate waste and improve value to the customer. Measures should help determine the success along that path but improving the numbers is not the aim, the numbers are merely proxies for that aim.

Successful management improvement is not about mindlessly applying quality/lean tools. The tools and concepts are very helpful but then people must make judgements about what is needed, what to emphasis, where to focus, how to proceed given the current organization…
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Centralizing decision making is not an effective way to manage organizations. Organizations need to encourage improvement by everybody in the organization. We need to create a system where that is encouraged and supported.

However, there can be problems with just making improvements individually. We tend to overreact to variation. Therefore we tend to tamper with systems which actually increases variation and reduces performance. Also there can be effects on other parts of the system due to a change that are not obvious at the point of change. We need to remove undue bureaucracy. However, it is good to remember that, such efforts are much more effective and safe when supported by a good system (standardization, PDSA, visibility, communication, lean thinking, well trained workforce…).

Without an understanding of systems and interactions sometimes changes are made without an understanding of the consequences those changes. The beer game is a good example of one way this can cause problems (people don’t always understand all the consequences of their actions). To be clear I agree with setting up systems that allow people to make improvements in the workplace. Just be cautious to avoid tampering.
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IHI has created the 5 Million Lives Campaign in the wake of the successful saving 100,000 lives campaign.

IHI understands how to manage improvement: this campaign has great possibilities to improve the health care system. See previous posts about IHI’s work: Going Lean in Health Care - Seven Leadership Leverage Points - Fixing Health Care from the Inside - Deming Institute Conference: Tom Nolan

Another YouTube video on Toyota Management (produced by a software vendor selling to Toyota Europe): Toyota’s Nick Dieltiens Discussing Lean Techniques. He is responsible for strategic planing for Lexus Europe and was previously for the lean operations office for Toyota and Lexus Europe. He discusses adopting lean thinking in sales and marketing. the consultant’s web site includes another webcast with Nick Dieltiens. In a previous post we comment on a good article reviewing Toyota IT Systems. The videos don’t provide as much insight as that article but have some interesting points.

Interesting, 4 minute, segment on Toyota management practices from a business TV show.

via:Lean Six Sigma Academy Blog

Related: New Toyota CEO’s Views - What drives Toyota? - Toyota - Repect for People - Dell Falls Short - posts on management webcasts

The newest data from the UN confirms most of the recent trends in manufacturing output - most notably that China continues to grow dramatically. The data also shows a stagnation in USA manufacturing output over the last several years, though the USA remains by far the largest manufacturer. The most significant news from this latest data, I believe, is that that manufacturing output growth in the USA has been slower than global manufacturing output growth from 2002-2005. This was not the case prior to 2002. I will be writing more on this data in the Curious Cat Investing and Economics Blog. UN Data, in billions of current US dollars:

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Interesting article on applying game theory to business decisions. Game theory is a tool that is not often used. Though most organizations are probably better off improving how they use the rest of their management tools, it is fun to read about and does have merit in the right situations. 16,777,236 - That’s the number of outcomes that are possible when eight competitors each consider three strategic options.

via: Globe and Mail on game theory

This podcast on Lego Mindstorms NXT, Lead Users, and Viral Marketing is interesting. The discussion does a good job of explaining how factors like web 2.0 and “open source” can allow business to operate in a new way and take advantage of new opportunities. Understanding these ideas is much more innovative than most of what I read in the “business press.” And the message is explained clearly, so one does not need to understand these concepts to appreciate the business opportunities. See links below: Lego Mindstorms are also just cool.

via: eContent

Related: Open Source for LEGO Mindstorms - Lego Learning - science and engineering podcast libraries - Gadgets and Gifts - Intellectual Property Rights and Innovation - Better and Different

Well actually it isn’t a secret - it is in fact the Toyota Production/Management System. Maybe, if people assume the TPS is about improvement in the factory alone, then they could miss the true importance as the management system that it is. So I quibble a little bit with the title but this is actually a good article by John Teresko, Toyota’s Real Secret: Hint, It’s Not TPS:

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Nice article, nice title too, a bit overoptimistic maybe but still nice - It’s Easy Being Lean:

Related: Wisconsin Manufacturing - Global Manufacturing Jobs Data - Applied Quality Engineering Education - lean thinking articles

Recipe For Success:

I have discussed some of his ideas before in, for example, Agile Management (which includes a link to a interesting interview on David Anderson’s work at Microsoft incorporating Deming’s ideas and Theory of Constraints. Others might have their own focus but creating a focus to your efforts is valuable.

I don’t have mine as nicely framed but for me: build capacity (of the organization, which largely means building the capacity of the people) and seek systemic improvement (not how to improve the results today or tomorrow but how to improve the system so results will be better as a consequence). And, for my current position, prioritize (the IT solutions provided and the management improvement aims).

Related: A project is a collection of value scheduled for realization - D.J. Anderson - Microsoft CMMI - Curious Cat Management Improvement portal

The new Newt thing

I am not really sure what he means by “externalized systems.” He does actually know about Deming’s idea and management history. For those outside the USA he is a former Speaker of the House of Representatives and current Republican Presidential candidate.
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Interesting paper - The Dynamics of Crowd Disasters: An Empirical Study (also see the supplemental materials). Systems thinking allowed the engineers to design a solution that wasn’t about enforcing the existing rules more but changing the system so that the causes of the most serious problems are eliminated.

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This presentation web video discusses the idea of managing corporate information: Seamless Information Capture and Discovery for Corporate Memory. The video focuses on discussing technical solutions.

The most important factor to me, is the value to improving management. The technology discussed here eventually could help lead to the adoption of Dr. Ackoff’s ideas on capturing corporate decision making. Then that will allow evaluating decisions for systemic weakness and strengths to improve decision making. Ackoff’s ideas in this area tie very closely to Dr. Deming’s ideas on the theory of knowledge and the importance of prediction to management.

There are several reason these ideas have not been adopted but one is that they require some effort to document and then evaluate (and often those are missing). So many see any time spent improving the system as waste (based on their actions not that they would say such a thing) - they are only happy when producing today or fire fighting to enable producing today.
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Previously we posted on recalls at Toyota and Sony. Recently Toyota announced another large recall. Investor’s Business Daily writes on the topic in: The Ups And Downs Of Doing Product Recalls – Japan-Style:

Interesting. The article also discusses a commitment to zero-defects. I agree with Dr. Deming that this is not the right strategy, but Toyota’s actions around that concept seem reasonable. Many other companies actions around a “zero-defect effort” are not effective in my opinion. See our previous post reacting to Norman Bodek’s post on zero defects. Toyota is doing well but as they say themselves, over and over: Toyota still has plenty of room to improve. The key is to not only say so, but act on it (which I believe they are doing, but the recalls give one indication of the continued need to improve).

Related: Quality and Innovation - Ford and Managing the Supplier Relationship - Cease Mass Inspection for Quality - Cease Dependence on Inspection

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Performance Measures and Statistics Course - free course materials from a 2 day training course by Steven Prevette. Topics include: Dr. Deming’s red bead experiment, operational definitions, selecting performance targets, SPC, theory of variation, case studies, control charts, pdsa, pareto charts, histograms…

Related: Quality, SPC and Your Career - articles by Steven Prevette

Great stuff from the DailyKaizen:

So few organizations can think beyond the current urgent need (often this day or week or month, not even quarter). Thinking long term is not about waiting around. But it is about constancy of purpose. The powerful gains from any management system are not those in the first year. The benefits possible in the 5th year or 10th year… are not possible in first year. The capacity to take advantage of management improvement needs to be developed and it is a multi-year effort (if it is done well - otherwise it will abandoned after the initial hype for the next new fad). The gains should grow and compound over time.

Related: Lexus: Long Term Thinking

More links to interesting management improvement blog posts.

• Lean IT - what comes first, technology or waste reduction? by Kent Blumberg - “rather than pushing technology on people and processes (the traditional top-down approach), Toyota looks to the people and processes to pull the technology they need to support their decision making.”
• Who Is GM’s Customer? by Dan Markovitz - “The average car buyer can’t calculate the cost of GM’s excess inventory, of course, but they don’t need to. That cost manifests itself in higher prices, or cheaper materials, or fewer features in the actual cars.”
• Top 5 Lean Manufacturing Books for Beginners by Jon Miller - Taiichi Ohno’s Gemba Keiei, The Toyota Way, Toyota Production System, Today and Tomorrow by Henry Ford, The Sayings of Shigeo Shingo
• Rube Goldberg Takes On Supply Chains by Kevin Meyer - “Is manufacturing in Everett really that difficult that flying tons of aluminum around the world makes more sense than to reemploy all those workers?”
• Technology Must Not Rule by Rob Berg - “Technology enables, but even the best technology absent good management leads to failure. As such, genuine Business Process Management expertise must precede BPM technology”

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Another article on the UK national health system using lean thinking: In the drive to save the NHS, I’m choosing a Toyota by Simon Caulkin:

Related: Lean National Health System - Management Improvement History and Health Care - Epidemic of Diagnoses - Toyota Production System blog posts

Performance review proponents say the way it is done matters most (based on reaction to: Performance appraisals get low marks):

Good execution of performance appraisal is not the solution. More people are realizing that improving how performance appraisal are done is an attempt to do the wrong thing better. If you insist on doing the wrong thing, I suppose you might as well do it better but how about just not doing the wrong thing at all? What should be done? See: Performance Without Appraisal and read chapter 9 of The Leader’s Handbook.

Related: Problems Caused by Performance Appraisal - Deming on Performance Appraisal - Performance Without Appraisal #2 - Performance Appraisal Problems