In his article Jim refers to Pareto’s (Mr. 80/20 rule) second concept of economic optimality, and immediatly reminds me of this phrase in the Hippocratic Corpus: “first do no harm.” Some lean practitioners attempting to drive change unfortunately ignore this admonition at their own peril.

If, in our zeal to improve something, we cannot envision how our ideal future state may negatively impact another part of the organization’s currently “adequate” state, then we are indeed not optimizing the whole. Rather, we fall back on the silo-thinking which created the need for making changes/improvements in the first place.  And that’s where true “Lean Leadership” in the executive ranks shows what it’s made of.  Go forth, ye, and make sustainable Lean happen! 

And that’s the way I see it.  Adam Zak

Do you have the Lean Leadership team necessary for your company to survive, and even thrive, during the current economic downturn?  Do your Lean Leaders have the expertise and experience to build a stronger foundation for growth and profitability during the coming rebound?  

As a recent message from Jim Womack’s Lean Enterprise Institute emphasizes, great Lean Leaps are made during tough economic times. Taiichi Ohno pushed the Toyota Production System through the entire Toyota Motor Company in 1950 during the great crisis that had left Toyota teetering on the brink of bankruptcy.

Short term, the right Lean Leaders will create immediate benefits:  freeing cash through elimination of excess inventory, protecting profit margins by improving quality and productivity, strengthening ties with customers by improving service, and converting orders-to-cash faster by reducing lead times. But just as importantly, strategic Lean Leaders will also help your company build for the future and create long-term competitive advantage. With the right Lean team in place your company can advance its Lean transformation using a systemic approach across the enterprise:

• By developing employees as problem solvers;
• By changing the management culture from command and control to fact-based and flexible;
• By extending the Lean transformation beyond the manufacturing shop floor to finance, engineering, marketing, and other critical support areas;
• By implementing Lean principles across the supply chain at your key suppliers and at their key suppliers;
• By transitioning from a tools-based implementation path to a course that applies Lean Management as a complete business system;
• By changing the very culture of how the organization thinks and conducts business on a daily basis.

You know it makes sense.  Do it!

Extraordinary times call on us to look again to the core of the Toyota revolution and how we can make it our own

Strange things happen in a crisis. Consider, for example, that some companies, in retrenchment mode, are cutting back on investments that not too long ago they were eager to make in learning and implementing the principles of the Toyota Production System. At least part of the market for improvement seems to be shrinking, in other words, at precisely the moment when just about everything in the marketplace seems to need improvement.

This is more than just strange. After all, Toyota’s management system was forged as a response to severe economic hardship, its basic mindset tempered by the threat of catastrophe. Circumstances have changed over the years, of course, but the Toyota system has proven to offer a potent and strikingly reliable way to survive-and even thrive-against fierce competition, in hard times as well as good. Its signal strengths – relentless cost cutting, commitment to people and dedication to long-term vision – are made for crisis.

Clearly the message is not lost on some businesses, where leaders are intensifying their focus on learning lean. But other companies remain a puzzlement. Why, when they stand to profit from it most, are some retreating from efforts to reap the benefits of the Toyota revolution? 

One reason may be that, over the years, we have allowed ourselves to misconstrue Toyota’s achievement and how we might best absorb and extend it. Despite our best intentions, we have sometimes treated it as we vowed we never would: as a commodity, a set of “tools” or techniques, a “program.” We have bought and sold it in the form of workshops and how-to books, training regimens, acronyms, certificates and prizes. No matter how sophisticated our grasp of lean’s deep roots, we have nonetheless been willing to shape it to the market’s eagerness for surefire recipes, delegable formulas and instant gratification. We have busied ourselves with superficialities and too often found convenient distractions from the hard work of criticizing ourselves, nurturing others and contributing to society. 

Criticizing, nurturing, contributing-these are not empty words. They lie at the explicit heart of what Toyota’s leaders have been striving to achieve all along. 

Rebranded as “lean” by Jim Womack and Dan Jones, Toyota’s approach to management is notoriously difficult to define, a dynamic infrastructure, at once straightforward and complex, of shared convictions, principles and practices. In order to make lean intelligible (and, some might say, marketable), proselytizers variously explain it in terms of structures (e.g., houses, pyramids), procedures (“First do this, then do that….”) or “tools” (5S programs, kanban, OEE, value stream maps, A3s, etc). All reasonable enough on the face of it. 

But something seems to be missing. While none of these elements is foreign to lean, it seems fair, especially in the current context of economic upheaval, to ask whether some of our representations of lean might not be fragmented or rootless. Do the parts – like the parts of the blind men’s elephant – somehow obscure the whole? Have we neglected common principles and key unifying forces underpinning lean’s success, forces such as commitments to internal and external communities, near-obsessive quality consciousness, relentless diligence or even, tellingly, the motivating fear of failure? 

Questions such as these take us back to a deeper lean, a lean in which techniques are inextricably bound to underlying principles and convictions -  principles of Takt, Flow and Pull, to be sure - but also the conviction, for example, that current methods are deeply inadequate, that enduring commitment to people is essential, and that true competitive strength relies on strategic coherence between everyday workplace decisions and long-range aspirations to collective betterment. 

That such things are difficult to talk about and difficult to package doesn’t authorize us to ignore them. Especially not now. Indeed, this is a crucial time to rededicate ourselves to such basics, not merely because they provide an extraordinarily sound basis for cost cutting in the short term – which they assuredly do – but because they lie at the core of building competitive strength for the long term. 

There is more, too. Lean’s animating convictions and principles turn out to be directly relevant to what appear more and more to be fundamental shifts in marketplace values.

Evolving Values

Consider one example of lean’s connections to the changing nature of value. 

Communications technologies and recent political trends are bringing ever more transparency to the relationship between private and public interests. As this happens, social considerations increasingly enter into the calculations of profit-making enterprises. Businesses are taking greater account of the impact of their behavior on the greater community, the well being of their employees, the health and safety of consumers, the overall energy supply and even the sustainability of the natural environment. As costs increasingly attach to private use of the commons, for example, it is becoming harder to see any advantage in fouling the nest. Social responsibility is newly respectable. 

This trend is already underway in at least two forms. On the one hand, many businesses must increasingly prepare for public scrutiny and regulation of their activities.  On the other hand, positive social contributions are looking more and more like useful selling points. Wal-Mart’s embrace of energy-efficient light bulbs, the flowering of the renewable energy industry and Honda’s quest to improve bystander safety are small signs of this evolution in values. It is not tangential that the president of the United States wants to see American automakers build more energy-efficient vehicles. 

And lean’s role? It turns out that lean’s defining preoccupations – with relentless waste reduction, with nurturing people and with strategic coherence-provide powerful models for cutting - edge thinking and practice in this changing landscape. Examples abound, from the extension of healthcare improvements beyond industrial notions of heightened efficiency, to manufacturing’s emerging recognition that pollution and wasted energy are forms of muda, to new insights on how service industries can meet evolving standards of customer privacy. The opportunities for improvement are rich and potentially enriching. To see them, however, we need to stop thinking of lean as a toolbox and start recognizing its true breadth and depth. 

Learning Lean

How can we most effectively tap into this “deep” lean? 

There are undoubtedly some aspects of effective lean leadership that depend on knowledge; others are expressed by how we reorganize processes and structures. Intertwined with all of these and of far more consequence than any, however, are deeper lean attributes, shared in the community but rooted in each individual: distinctive sensitivities, values, perspectives, convictions, habits, attitudes and reflexes. Even for accomplished leaders, developing these qualities – developing a robust lean “mindset” – requires time, persistence and guided engagement with the workplace in all its chaotic intricacy. This implacable fact applies, indeed, to everyone, because the lean ideal envisions an organization in which all can and do contribute their capacities for improvement. It stimulates the intellect to learn about lean’s “DNA,” but nothing actually changes until we learn how to replicate that DNA through practice. 

For individuals, as for organizations, learning lean beyond its superficial aspects is less like acquiring tools than it is like knowing how and if and when to use them. One doesn’t become a virtuoso pianist, after all, by buying a piano or attending workshops or reading books. Such activities may have supplemental value, but the core of acquiring mastery lies in disciplined practice. Practice, practice, practice. It lies in taking action and making mistakes and thereby learning to hear and see subtle distinctions that others don’t. It lies in developing new reflexes and in pursuing perfection. To borrow the language of the old joke, there are two ways to get to Carnegie Hall, but only one of them will get you on stage.

Pursuing the metaphor of musicianship a bit further can be helpful. Great musicians – even good musicians – are invariably nurtured by good teachers. This is as true of orchestra or ensemble players as it is for soloists. One can find similar examples with little difficulty: athletes and their coaches, soldiers and their trainers or doctors and their mentors. Self-taught virtuosos in lean, in any case, are rare enough that you wouldn’t want your organization’s success to have to depend on your being able to hire them. 

This truth about learning should recall to students of lean the importance of wisely guided practice and application of lean’s core values. It also underscores a challenge for conscientious lean teachers (who are likely, by the way, to shun boastful labels such as “guru” and “sensei“). The challenge is this: history shows that lean, like music, is most reliably taught through forms of coaching or mentoring. Numerous complementary activities may be valuable and can and should be exploited, but the essential reflexes and convictions that make superior lean leaders – and lean organizations – are best developed though guided, disciplined practice and experience. That good coaching may be difficult to scale, market or commodify is irrelevant or at least of secondary importance to the central fact of its effectiveness. Yes, there are subtleties and complexities to be reckoned with, especially when one considers the needs of transforming large organizations. The basic lesson, though, is pretty straightforward: If you’re serious about getting better at lean, get a coach. If you’re serious about teaching lean, be a coach. 

Moving Forward 

Toyota, facing the same difficult times as everyone else, shows no signs of giving up on the Toyota Way. That hard times prompt some other organizations to retreat from their commitment to lean indicates, perhaps more than anything else, the degree to which we – students and teachers alike – have allowed ourselves to be distracted from the powerful convictions, principles and practices at the heart of the revolution. This is an exciting time for lean, but only, paradoxically, when we return to the basics and only when we remember to apprentice our ambitions to sustained and disciplined practice.

Andrew Dillon, an independent management consultant, is a long-time observer and participant in the lean revolution. In the 1980s he served as Shigeo Shingo’s interpreter in the United States and translated many seminal works on lean. He works in English, French, Japanese and Chinese. He can be reached via apdillon@att.net.

Jim Womack (Machine That Changed the World, Lean Thinking, Lean Solutions) wrote about how General Motors must repurpose itself before it restructures.  The idea, of course, being that each organization needs customers who will derive some value from what the organization actually delivers. A restructuring to reduce costs and thereby generate profits actually doesn’t do much for the customer. As Jim puts it:

 ”What does your organization do to solve customer problems better than competitors so that customers old and new will pay good money for your services and goods and buy more over time?”

And then I read a second e-mail, a press release from Ryanair, which describes itself as “Europe’s largest low fare airline.” Ryanair has been running a contest in which passengers submit suggestions which can be turned into revenue generators for the airline. In other words, what do passengers value and what are they willing to pay good money for (in addition to the actual service of being flown from point A to point B, I suppose).  So what will Ryanair passengers shell out for?  Here are the top five items, based on the number of passenger votes received (note: O’Leary refers to Michael O’Leary – shown at right - the airline’s CEO):

1. €1 for toilet paper – with O’Leary’s face on it,
2. €2 “corkage” fee for passengers who bring their own food,
3. €5 annual subscription to access Ryanair.com,
4. €3 to smoke in a converted toilet cubicle,
5. Excess fees for overweight passengers based on body mass index.

The poll ends April 17th. I’ll be following to see which, if any, of these suggestions Ryanair actually implements. After all, what’s the point of asking for suggestions if you’re not planning to deliver on any of them?  Although I guess I’m also trying to figure out why anyone would want to pay for this stuff and what customer problems these suggestions might be solving.

Finally, is there anything GM might learn from this exercise?  We’ll leave that question for another day.