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Lean thinking, lean manufacturing, Toyota Production System management and manufacturing thinking. See our lean management portal, inlcuding lean articles (articles by Jim Womack) and online resource.
Terms: continuous flow - kaizen, jidoka, JIT, muda, mistake proofing, takt time, more
Recommended posts: Respect for People - Lean Thinking and Management - The Lion of Lean - Visible Data - Bad Management Results in Layoffs
Toyota has developed a thought-controlled wheelchair (along with Japanese government research institute, RIKEN, and Genesis Research Institute). Honda has also developed a system that allows a person to control a robot through thoughts. Both companies continue to invest in innovation and science and engineering. The story of a bad economy and bad sales for a year or two is what you read in most newspapers. In my opinion the more important story is why Toyota and Honda will be dominant companies 20 years from now. And that story is based on their superior management and focus on long term success instead of short term quarterly results.
Yes Toyota can improve their performance, based on the last few years. Does management understand what they need to do? I think so. Does management understand that the system needs to be improved rather than the numbers on the spreadsheets of various managers have to be made better? I think so. Do I think most companies today, with bad results, understand the difference between bad numbers on spreadsheets that are used to judge various managers and a system that needs to be improved? No.
I do not believe the bad earnings for the last year for Toyota are indicative of a failed system. The results do show a weakness in the Toyota system that allowed them to perform this poorly during this credit crisis. The risk to Toyota’s future is that they become too focused on short term results, mistakenly thinking the problem to be fixed in the bad quarterly results recently. They need to focus on improving the system for the long term. And the recent experience likely shows some areas that need to be improved. But in no way do the fundamental tenants of the management system need to be changed. For many other companies today, changing fundamental aspects of their management is what is needed.
Related: Toyota as Homebuilder - Honda’s Robolegs Help People Walk - Honda has Never had Layoffs and has been Profitable Every Year - Toyota’s Partner Robot - NUMMI, and GM’s Failure to Manage Effectively - Toyota iUnit - Invest in New Management Methods Not a Failing Company by William Hunter, 1986
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How P&G Finds and Keeps a Prized Workforce by Roger O. Crockett
Career education takes place outside the classroom, too. P&G pushes every general manager to log at least one foreign assignment of three to five years. Even high-ranking employees visit the homes of consumers to watch how they cook, clean, and generally live, in a practice dubbed “live it, work it.” Managers also visit retail stores, occasionally even scanning and bagging items at checkout lanes, to learn more about customers.
Going to visit the gemba, the actual place is incredibly important, and far too often ignored by managers today.
The emphasis on life long learning (in practice, not just words) is also very wise. In my experience far to little emphasis is placed on continual improvement of what many companies will say is their most important asset: their people. If you don’t invest in education of your staff that is going to harm your long term success. The investment P&G makes shows a respect for people.
Related: Jeff Bezos Spends a Week Working in Amazon’s Kentucky Distribution Center - Workplace Management by Taiichi Ohno - Respect for People, Understanding Psychology - Ohno Circle
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Great, short, presentation webcast by Jason Yip showing the importance of making problems visible. Anyone interested in software development should watch this, and it is valuable for everyone else, also. Great visuals.
Related: Future Directions for Agile Management - Agile Software Development Slideshow - Leading Lean: Missed Opportunity - Information Technology and Management - Curious Cat Micro-financiers - posts on project management - Toyota Institute for Managers
Photo of Jeff Bezos during the 2005 O’Reilly Emerging Technology Conference by James Duncan.Jeff Bezos, Amazon CEO, is working for a week in Amazon’s Kentucky distribution center. I hope, and based on his past, I believe, that he is going to the gemba (Genchi Genbutsu) to learn more about how Amazon operates. That would be great.
He worked on wall street and understands the fake constraints they attempt to put companies (you must focus on short term profits, you must focus on pleasing wall street analysts not customers…). He understood the importance of managing cash flow and the unimportance of short term profits. And he understands the importance of customer focus. He understands lean thinking. We need more CEO’s like him.
“He is there to work,” Smith said, “and, unfortunately, we are just not scheduling any interviews while he is in town.”
Local Amazon employees say Bezos is working in the warehouse with the company’s hourly employees to see what they do and hear their comments about their work. Most CEOs would benefit from spending a few days on the shop floor.
Once again his actions indicate he is the type of CEO I want to invest in.
via: Jeff Bezos Works In Kentucky Distribution Center For A Week
Related: Jeff Bezos and Root Cause Analysis - Management by Walking Around - Amazon Innovation - Amazon’s Amazing Achievement - Louisville Slugger, Deming Practices - Management Excellence
Gipsie Ranney recently sent me an article on her thoughts on NUMMI and the current problems with the Big Three car makers to post to the Curious Cat Management Improvement Library. NUMMI is the plant that Toyota and General Motors run together as a joint venture. The article is excellent.
I agree. The problem is that management fails to manage well and has been failing to do so for decades. They have improved over the last few decades but not nearly fast or consistently enough. Gipsie worked closely with Dr. Deming and serves on the W. Edwards Deming Institute Board of Trustees.
Related: Could Toyota Fix GM (2005) - At Ford, Quality Was Our Motto in the 1980s - Big Failed Three, Meet the Successful Eight - Why Fix the Escalator? - Invest in New Management Methods Not a Failing Company (AMC) by William Hunter, 1986 - Ford and Managing the Supplier Relationship - No Excessive Senior Executive Pay at Toyota
Zara Thrives by Breaking All the Rules
In addition, Inditex supplies every market from warehouses in Spain. Even so, it manages to get new merchandise to European stores within 24 hours, and, by flying goods via commercial airliners, to stores in the Americas and Asia in 48 hours or less.
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As a result, the chain doesn’t have to slash prices by 50%, as rivals often do, to move mass quantities of out-of-season stock. Since the chain is more attuned to the most current looks, it also can get away with charging more than, say, Gap. “If you produce what the street is already wearing, you minimize fashion risk,”
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For rivals hoping to mimic Inditex’s results, analyst Luca Solca of Sanford C. Bernstein has a bit of advice: Don’t follow the Zara pattern halfheartedly. “The Inditex way is an all-or-nothing proposition that has to be fully embraced to yield results.”
Very true. Processes work well within a system. You can’t copy from one system to another. You can learn about what has been successful and figure out how you can adapt to take advantage of the ideas within your systems.
Related: Lean IT Systems - Not ERP - Systemic Thinking - What Kind of Management Does This? - Making Suits in the USA - Curious Cat Management on Lean Thinking
The Office of Governor Pawlenty issued a press release on Minnesota’s Drive to Excellence effort:
Read about more public sector management improvement efforts on my Public Sector Continuous Improvement Site.
Related: Six Sigma In New York Local Government - Transformation and Redesign at the White House - The Georgetown Kentucky Way - Public Sector Management
Cost Cutting is Much Different than Waste Removal by Jim Womack
This last expedient is the one I most fear, because it is likely to be justified in the name of “lean.” Every recession seems to produce a major cost-cutting campaign sold by traditional consultants. Their key promise is rapid financial payback, even within one quarter, and the only practical way to achieve this is layoffs. I truly hope that the recession of 2009 will not be known to history as the “lean” recession and everyone in the Lean Community should vow to avoid the cost-cutting urge in their own organization.
To avoid the need for cost cutting, I hope that every would-be lean enterprise will assign someone responsibility for developing a “recession A3″ that carefully reviews the background situation. The critical step in the A3 process will then be to develop a set of countermeasures that can protect the organization and its people through the current recession while laying the ground work for a sustainable lean enterprise in the future.
Related: Operational Excellence - Going lean Brings Long-term Payoffs - Bad Management Results in Layoffs - Cutting Hours Instead of People
Engineers Rule, 2006
I checked and Honda was also profitable in 2007 and 2008 fiscal year (ending in September) and no I see no evidence of any layoffs this year (when I look online).
Related: Honda Engineering - Back to School for Honda Workers, 1993 - The Google Way: Give Engineers Room - Google’s Ten Golden Rules - Toyota as Homebuilder - Curious Cat Science and Engineering Blog - Toyota’s CEO pay under $1 million
Lean and Kanban for Software Developers by Clinton Keith
Time-boxing is the first step in beginning to find a balanced flow for our value stream as visualized on our Heijunka board. However, one problem exists. Each stage of effort in the stream will require a different length time-box. This can cause gaps and pileups.
For example, if our level designer can lay out a level in a week, but the high res artist requires two weeks, then a lot of work can pileup for the high res artist. Conversely, if the concept artist requires two weeks to complete the concept art for each zone, the level designer might be waiting for work with nothing to do. We have to find ways to balance this workflow smoothly so that everyone has work to do every day. One way of doing this is to balance the effort on each stage to achieve the same flow through the system.
Related: Lean, Toyota and Deming for Software Development - Kanban In Software Engineering - A Programmers Take on Agile Software Development - Agile Software Development - Six Sigma in Software Development - Curious Cat Management Improvement library
Jim Lentz, president of Toyota Motor Sales, the company’s U.S. sales unit, said the company believes keeping employees on the payroll and using the time to improve their capabilities is the best move in the long run. “It would have been crazy for us to lose people for 90 days and [then] to rehire and retrain people and hope that we have a smooth ramp-up coming back in,” Mr. Lentz said.
In Princeton, senior plant manager Norm Bafunno said he can already see the benefits of the training. Mr. Bafunno cites a Teflon ring designed by an assembly worker during the down time that helps prevent paint damage when employees install an electrical switch on the edge of a vehicle’s door.
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Mr. Mason, a 40-year-old former firefighter, added: “One of the major things that everyone is grateful for is that they thought enough of us to keep us here.”
Toyota continues to show intelligence, long term thinking, respect for people… in their management decisions. I worry they may capitulate and make explanations about how the economy forced them to abandon their principles. I hope they prove that cynical fear in me to be wrong, in their case.
Related: Bad Management Results in Layoffs - Toyota Management Not Close to Being Duplicated - Toyota’s Commitment to Customers - People are Our Most Important Asset - Jim Press, Toyota N. American President, Moves to Chrysler
More people learning about manufacturing truths lean thinkers have known for a long time. Made (again) in America
But other longtime outsourcers, such as Regal Ware Inc., a 500-employee maker of high-end cookware (sets go for as much as $4,000), have discovered that manufacturing abroad has another drawback: it isn’t nearly as efficient as they had hoped.
“We either had too much inventory, or not enough” of the products Regal Ware outsourced to China, says Jeffrey Reigle, CEO of the Kewaskum, Wisc.-based company. “We figured there had to be a better way.”
The better way, it turns out, proved to be right under his nose, at two Wisconsin plants where Regal Ware has produced stainless steel pots and pans for more than 50 years.
Learn more about lean manufacturing.
Related: Lean Manufacturing Saving Jobs Again - Made in the USA (2006) - Workplace Management by Taiichi Ohno - New Look American Manufacturing - Wisconsin Manufacturing
Kenji Hiranabe talks about Toyota’s development process (webcast). Kenji shares a presentation he attended earlier this year by Nobuaki Katayama, a former Chief Engineer at Toyota, and the lessons he learned from him.
The webcast takes awhile to get going. If you are impatient you might want to start at the 6 minute mark. Some thoughts from the talk:
The webcast includes a nice (though short) discussion of agile management in software development and lean manufacturing (the different situation of manufacturing versus software development). Kenji Hiranabe has also translated several agile and lean books into Japanese including Implementing Lean Software Development.
Related: Kenji Hiranabe’s blog - Marissa Mayer Webcast on Google Innovation - Articles and webcasts by Mary Poppendieck - Future Directions for Agile Management - Interview with Toyota President
Agile management (agile software development specifically) is something that makes a big difference in my work life. David Anderson consistently provides great ideas on agile management and he does so again in this 90 minute presentation on the future directions for agile. As I learned about agile software development, what I saw was a great implementation of management improvement practices focused on software development that was very compatible with Deming’s management philosophy and lean thinking practices. The Agile manifesto:
The first line can seem to be at odds, but I think in practice it is not - though I admit it may seem that way based on the importance placed on process by Deming (I think you have to read on agile to understand why this is the case). For my use of agile software develop, a highlight of the most important ideas is:
Important concepts addressed by agile management: highly collaborative, risk tolerance, systems thinking, customer interaction, craftsmanship ethic [joy in work], eliminate waste. Great quote from the webcast:
Related: Kanban In Software Engineering - Management Science for Software Engineering - Improving Communication - webcast of David Anderson talking about applying Agile and Deming’s ideas at Microsoft - What is Agile Software Development?
I am not sure, IT needs to get lean on manufacturing, does the clearest job of explaining some things, but it does state some things well:
SAP or Oracle MRP are a problem because they cannot set up an “execution” system to perform based on lean principals.
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It is this new concept that is the biggest stumbling block for IT in terms of adopting lean manufacturing. Most major companies have invested multiple millions in their ERP system, and it’s IT’s job to run the system. On top of that, these software-acquisition decisions for the major ERP systems are made by the CEO and CIO, who don’t understand the shop floor.
What the article is really talking about IT departments providing the proper tools for organizations to manage. IT should also adopt lean methods for their operation (many in IT that are practicing lean are doing so with agile software development methods). Toyota, not surprisingly does well at using IT to support lean manufacturing.
ERP stand for Enterprise Resource Planning and in IT circles referrers to amazingly complex IT systems to manage the organization. Some people think they are useful, I think they are overly complex, poor management implementations that end up having organizations conforming processes to the IT system instead of having an IT system that support the organization. And they are far too complex - web 2.0 type applications should be the focus not ERP. IT should liberate people to be more flexible with designing processes, PDSA… not act to enforce rigid rules.
Related: lean manufacturing articles - Information Technology and Management - Agile Management
Justice served up Jacksonville–style is all lean by Joe Jancsurak:
Investigations stress uniformity. Lean “changed how we approach investigations,” says Sheriff Rutherford. “We found that three officers investigating three different burglaries might ask three different sets of questions. So we developed a standard form showing the questions that should be asked to ensure consistency.”
Hiring of school crossing guards made more expedient. “This one’s amazing,” Sheriff Rutherford chuckles. “It was taking us 68 days to hire someone from our eligibility list because we were sending candidates all over for different parts of the interview process. Now it takes us just three days to make a decision because we’re practicing ‘one-stop hiring.’”
This reminds me of the first efforts I know of for such efforts in policing (from the 1980s): Quality Improvement and Government: Ten Hard Lessons From the Madison Experience by David C. Couper, Chief of Police, City of Madison, Wisconsin.
Via: Upcoming Podcast: Lean Law Enforcement
Related: Failure to Address Systemic SWAT Raid Failures - LA Jail Saves Time Processing Crime - The Public Sector and Deming - Curious Cat Management Improvement Search Engine
Toyota’s Top Engineer on How to Develop Thinking People
Excellent advice.
And more wisdom. Great stuff from Taiichi Ohno, Nanpachi Hayashi and Jon Miller’s translation and great blog.
Related: Respect for People and Taiichi Ohno - Toyota IT for Kaizen - Management Improvement - Workplace Management by Taiichi Ohno - Posts on Respect for People
India’s Economic Times has an interview with James Womack, Now is the time for lean management, with an interesting quote:
I have discussed TVS several times in the past; TVS has won several Deming Prizes.
Related: TVS Group Director on India - Manufacturing, Economy… - Deming Prize 2007 - Indian Deming Prize Winner Expanding - Toyota Chairman Comments on India and Thailand - Curious Cat Lean Manufacturing
HP shatters excessive packaging world record
Sadly not. What the überbox did contain was 16 smaller boxes “which in turn [each] contained (wrapped in foam so they wouldn’t get broken) exactly two sheets of A4 paper”
It is hard to imagine what management system creates such solutions. But it is not hard to image Dilbert’s pointy haired boss fitting right in there.
Related: Is Poor Service the Industry Standard (HP)? - Muda/waste - Customers Get Dissed and Tell - Companies in Need of Customer Focus
Manufacturing has new look in R.I.
The closing of an old-fashioned assembly-line, low-wage factory always makes headlines, contributing to the image of the industry as one with a bleak future, Taito noted, while advanced manufacturers who steadily grow and add three or four jobs a year win no notice. “But that’s real growth, sustained growth,” she said of the latter.
Grove said RIMES has promoted the advantages of the lean initiative to Rhode Island manufacturers for about 10 years. “When you adopt lean manufacturing, it becomes the process of the whole shop and, by necessity, employees have to be more of a team than in the past,” he said. On-the-job training is routine at Pilgrim, according to Grove.
Still, the industry’s transition has not been painless. The number of manufacturing jobs in the state has declined steadily. In 2002, there were 64,796 people employed in manufacturing in Rhode Island and, 30 years ago in 1978, there were 134,654, according to figures from the R.I. Department of Labor and Training.
Yet another illustration of what I have been saying for years. USA manufacturing continues to grow and USA manufacturing jobs continue to shrink (as do worldwide manufacturing jobs). And as I have been saying for years, China manufacturing output continues to grow very quickly and China manufacturing jobs continue to shrink (China lost 7 times as many manufacturing jobs as the USA from 1995-2002).
Related: Manufacturing and the Economy (2005 post) - Creating Jobs - Top 10 Manufacturing Countries 2006 - America’s Manufacturing Future - Wisconsin Manufacturing - Manufacturing Employee Shortage in Utah
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