Gemba Panta Rei

According to an article today in the San Antonio Express News, a group people from Toyota visited the York International factory a few months ago to acquire air conditioners for the new Toyota factory. Visiting the factory the Toyota representatives said they had never seen the Toyota Production System applied so effectively used outside of Toyota's factories. This is high praise indeed.

This is a result of a 10-year pursuit of Lean manufacturing excellence at York, based on the Toyota Production System (TPS). The employees are trained in TPS and kaizen principles so that they can effectively produce to order in their high mix, low volume environment.

For York to have achieved this in 10 years is remarkable. While some consulting firms advertise "Lean Transformation in Weeks Not Years!" I think my Japanese teachers would say 'muri' - as in 'don't push it' - to that claim.

Even stretching the definition of "weeks" to 51 (just shy of a year) expecting a true Lean transformation, in other words a culture shift in which was Lean becomes truly a fabric of how everything is done, in less than years is 'muri' - not reasonable.

As the article explains, a key element of York's Lean transformation and sustained excellence in Lean manufacturing has been the continued education of their people, ongoing involvement by the people in kaizen activity, and selection of new workers for both attitude and adaptability - the willingness to change.

Maybe the physical transformation happen in weeks, but it can be undone in days without the years of developing the people to sustain and build on the Lean implementation. Lean transformation is an ongoing process.

Toyota is still transforming itself in ways big and small, over 50 years since they began their Lean journey and a solid 20 years after they were world class "Lean" by most measures.

Congratulations to all 369 people at at the York factory in San Antonio, Texas!

Follow this link for the full details of the article.

Posted by Jon Miller at 3:35 PM | Permalink | Comments (0)

Change is hard.

What a cliche. But it has achieved its high rank in the pantheon of "cliche-dom" because its underlying reality is so very common. A fact multiplied many-fold during virtually any serious kaizen event.

Cold hard fact: not everyone either wants to or is equipped to adapt to the changes required when a process makes the shifts typical in moving rapidly from batch and queue mindset to takt-flow-pull mindset and reality.

Sometimes that fact hits even the area supervisor or manager, who may feel that his or her role as last minute savior and keeper of all arcane scheduling voodoo rites will, post-kaizen, (correctly) be obsolete.

It can get tricky for you in the middle of the kaizen event when it becomes increasingly clear that that supervisor or manager you were counting on to take the leadership ball from you and run it now wants to take that ball and do something entirely undesirable with it!

When you are tasked to lead and shape the kaizen event預nd the considerable investment and opportunities riding on it熔ne of the most important things you must try to do is prevent backsliding once change is made.

The fact that there is a distinct term in Japanese, "hadome", meaning "prevent backsliding", indicates how common the pressures to revert to old and less successful methods can be.

Even in the best of circumstances and for positive reasons, situations and leaders change and are not available to continue to reinforce shifts to new processes and build on the successful but frequently delicate initial outcomes of a kaizen. This is especially critical in the weeks just following a major change.

This vulnerability emphasizes the need to cross train leadership even during an event itself. Do this by making a habit of giving several people in addition to the cell, unit, or area lead the opportunity to supervise changes to flow, to practice changing demand and capacity parameters, to adjust the workflow, and to gain exposure to helping guide the team as it practices its new "dance steps".

The outcome of applying this practice of spreading the exposure to basic hands-on control will be the creation of a knowledge pool within the team able to absorb the loss of a leader - for whatever reason - without also losing their hard-won gains, and subsequent forward progress and improvement.

Posted by Jon Miller at 9:55 AM | Permalink | Comments (0)

Today I had the opportunity to address the general session of the 43rd annual conference of the Association for Healthcare Resource & Materials Management. There were about 1,500 people in the audience, perhaps 1,000 Materials Managers and the balance exhibitors and conference organizers.

The content of the talk was an introduction to Lean concepts and how kaizen can apply to healthcare in particular. One of the key points I tried to make was the difference between the traditional approach to improvement (increase value added) and the Lean approach (get rid of waste). With healthcare costs increasing at double digits each year, increasing the value added (buildings, medications, equipment, etc.) improves effectiveness only slowly and at a high cost. The Lean healthcare approach is to get rid of the 7 types of wastes, as in the picture below:

I shook hands with about a dozen people after the talk who said their hospitals were already implementing Lean. Managers from two hospitals from Seattle, Virginia Mason Medical Center and Swedish Hospital, told me about their kaizen activities both in surgery and in administration. This was very encouraging.

One woman came up to me and said she was very excited by these ideas and she would tell everyone at her workplace about Lean. One person converted out of 1,000 made it worth the effort, especially if her enthusiasm can turn others onto Lean healthcare.

Afterward the talk I took a walk through the exhibitor's hall. The latest in information systems, management consulting services, surgical supplies, etc. was on display. It felt odd to see so much space and effort being dedicated to increasing the "value added" part of healthcare while so much of the process is still waste.

While I'm all in favor of faster and safer medications it would be good to see more space dedicated to prevention and root cause countermeasure of health problems, and more of a focus on methods, processes, and technologies that cut out waste from healthcare. Lean healthcare is just one such approach.

Posted by Jon Miller at 10:34 PM | Permalink | Comments (0)

The U.S. Armed Forces have been using a combination of quality improvement tools and methods for many years. Recently many bases, depots and command centers have been using Lean manufacturing and six sigma tools and principles very effectively to lower cost and improve responsiveness.

The work being done by the Naval Air Command under the name NAVAIR AIRSpeed is particularly interesting. AIRSpeed is described on the
NAVAIR website as

"NAVAIR AIRSpeed is a cultural change affecting administrative, non-production, technical functions of research and development, test and evaluation, acquisition and corporate operations processes within NAVAIR."

This sounds a lot like a Lean Office transformation. There are two great examples of Lean Office implementation here. In one case the funding document approval process was cut from 30 steps down to 18 steps, reducing the time from 28 days down to four days. In another Summer Hire Process project the improvements were from 4,000 man-hours to just 648 and a reduction in the cost of hiring an intern from $12,800 per person to $980.

This was done through a combination of Lean tools and DMAIC (define, measure, analyze, improve, control) to:

1. Define the goal
2. Map out the tasks
3. Understanding the entire workflow
4. Cross-functional team approach
5. Standardization

Most interestingly, in both cases these improvements were called kaizen projects. AIRSpeed acknowledges that kaizen events are an approach used to reduce cycle time, lower costs, and take out waste within the NAVAIR.

Some organizations pursuing Lean manufacturing and Lean office still prefer to avoid Japanese terms such as kaizen. Although there may cultural, political, and historical reasons for the avoidance of the word kaizen, we find that when companies don't openly acknowledge and embrace the Toyota Production System principles (which include kaizen) it can lead to a 'pick and choose' approach to Lean that is less effective in the long run.

You can't get much more American, culturally, politically, or historically than the Navy. If the word kaizen is good enough for the U.S. Naval Air Command, I'll have some kaizen with my next slice of apple pie.

Posted by Jon Miller at 3:06 PM | Permalink | Comments (0)

In a July 16, 2005 article in the Los Angeles Daily News I spotted an amazing article on how the Los Angeles Police Department is adopting Toyota Production System principles to kaizen the process of booking people they put into jail. Ladies and gentlemen, this is Lean government!

Here is the link. Please share it with your local police department, congressman, mayor, or anyone else in a position to influence how our tax dollars are spent.

The LAPD received training from Toyota University; a group within Toyota set up to educate their dealer network on how to be Lean. Toyota is aware that although their cars have a great reputation, the process of being sold one is not always defect-free or waste-free. University of Toyota has been established to fix this weak link in Toyota's extended Lean enterprise.

The 100,000 people the LAPD arrests per year and the processing that this requires is a perfect case for a Lean transaction. For interest, if we assume a 365 day, 24 hour operation, the takt time for processing arrestees at the LAPD is one person every 5.2 minutes. This means every 5 minutes of paperwork is the equivalent of one police offer full-time doing nothing but paperwork. Although the article doesn't get into what is the cycle time (processing time) this number provides perspective on the potential savings through kaizen at the LAPD.

The article emphasized that one of the lessons learned by the good folks at the LAPD was root cause analysis. This has helped them to continue making improvements in their processes. One hopes this Lean thinking spreads to all parts of law enforcement (what is the root cause of crime, anyway?)

As the largest employer in the United States, and arguably one of the largest visible sources of waste, it would be great if the U.S. government invested in teaching civil servants Lean thinking.

But for now, I'll happily take TPS at the Los Angeles Police Department. Kudos to you, LAPD! Keep up the good work! Are listening, Governor Schwarzenegger?

Posted by Jon Miller at 6:43 AM | Permalink | Comments (3)

When learning to implement Lean manufacturing or Lean office principles one of the essentials is to develop a deep understanding of the 7 types of waste. Many people start working with the tools right away, value stream mapping or doing 5S activity without clearly linking this activity to waste reduction.

The concept of waste (Muda in Japanese) is common sense once it is explained to most people in a Lean manufacturing context. Yet because it is such a simple and universally acceptable idea, some people think it's too simple and needs to be "improved". This results in the addition of new wastes, anywhere from 1 to 13 new wastes in our experience.

The main reason we recommend staying with the original 7 wastes is to keep it simple. Other types of waste can almost always be included in one of the 7 types, or they are a cause of the waste rather than a waste itself. For example "complexity” is sometimes included as a waste, but this is more a cause of other types of waste such as transportation or processing waste or the waste of defects that result from complexity.

In the early days of developing the Toyota Production System some 50 years ago Taiichi Ohno identified the original 7 types of waste. He is said to have used the Japanese expression "Even the best person has 7 bad habits" as an inspiration. One question I ask is "If after more than 50 years of waste elimination Toyota hasn’t added new wastes, do you really need to?" While that might stump some people, it doesn't really help them explain to others why there are 7 and not 8 wastes.

The question we hear the most is "What about the 8th waste – the waste of peoples' unused creativity?" Some texts on Lean have added this 8th waste. The so-called 8th waste usually describes the fact that the creativity or ideas of the people are not being used to improve the work. While this is clearly a loss that Lean and Kaizen must correct, it is does not fit with one of the 7 types of waste that you can see in a production of service process.

If people’s ideas are not being utilized, this means that you will have more of the 7 wastes (defects, motion, inventory, transportation, overproduction, processing, waiting). It’s important to understand that certain things (like underutilized creativity) cause waste, and waste causes losses in profitability. In other words:

Unused creativity > less effective processes > 7 wastes > lower profitability

There is an important cause and effect relationship that needs to be understood. Lean implementation is much more about changing behaviors and how people think about work than about actually changing 'things' (procedures, factory layout, systems, etc.). The 7 wastes are the link between the root causes (human behaviors) and the loss of profit. Thinking deeply about the 7 wastes and learning to see and measure them in every process is the key to taking quick, effective kaizen action.

Posted by Jon Miller at 2:04 PM | Permalink | Comments (6)

Toyota announced 1.6% price increases in several Lexus and Scion model vehicles on Friday July 8, 2005. Some months ago when Chairman Okuda said Toyota may raise prices to help out struggling Ford and GM, I was impressed again by Toyota. This time Toyota was quick to deny that this price increase had anything to do with that prior statement, however.

Even if it had been an effort to help out GM and Ford I'm concerned that it would have been a wasted effort. With the years of 0% financing and the recent "employee discounts for everyone" promotions, one wonders if customers will every pay anything close to sticker price for American cars again.

If it were a game between Toyota, GM, Ford and a few other higher-end players that is one thing. But the low-end competition is getting tougher with Hyundai making impressive gains in quality and performance at low prices. That is to say nothing what will happen once vehicles made in China by Chinese automobile companies start rolling into American ports.

Do GM and Ford have enough time to turn things around? If they took the best of what is available and rapidly deployed Lean thinking and kaizen to every corner of their operation would it be enough? It seems doubtful.

Economists have pointed out that compared to Japan, China or Korea the United States government does very little to guide industrial development. With the notable exception of the defense industry, there is relatively little policy or money directed at helping to keep industries such as automotive or steel from failing. Perhaps the U.S. government should do more.

With oil at $60 per barrel this week a good use of tax money may be to direct Detroit to design and build vehicles that meet a certain fuel efficiency criteria. The government could also add a hefty tax credit for the purchase of these vehicles. Would Americans buy smaller, lighter cars and trucks that did 36 miles to the gallon instead of 12?

The financial case could certainly be made, and perhaps even a patriotic one if dependency on petroleum imported from other countries is lessened. This is the sort of big picture thinking that some governments do.

The term 'laissez-faire' was coined by a French economist, Jacques Quesnay. Laissez-faire is used to justify market economies and argue against government intervention in the economy (the type of intervention I am pondering here). In theory unregulated markets function naturally to provide the greatest good. In practice, there are differences between theory and practice.

It is interesting to note that Mr. Quesnay is said to have chosen the term 'laissez-faire' from a translation of the Taoist texts which were popular in France at the time. The concept of 'wu-wei' from which 'laissez-faire' thinking derives is often translated as 'no action'. In fact wu-wei is better understood as the role of a wise leader to cause things to happen through supporting a state of harmony so that the actions required can happen naturally.

Taoism is a much stronger feature of Chinese culture than Japanese culture so it's too much to hope that Toyota executives are demonstrating enlightened leadership through their 'inaction'. But perhaps some wu-wei on the part of the U.S. government would help create the harmony needed to pull GM and Ford out of the doldrums.

Posted by Jon Miller at 12:11 AM | Permalink | Comments (0)

Every now and then a very intelligent manager or engineer will question the whole approach of putting a kaizen team together to spend 3 to 5 days working on a problem when the solution is 'obvious' to this very smart person. Putting aside the question of why the problem hasn't been solved already if it's 'obvious', we still need to reassure these experts and specialists that cross-functional kaizen teams are a better approach to finding and implementing solutions than the 'lone ranger' approach.

Until recently, our case for kaizen events and kaizen teams has been "Trust us. This works." In the book "The Wisdom of Crowds: Why the Many Are Smarter Than the Few and How Collective Wisdom Shapes Business, Economies, Societies and Nations" by James Surowiecki the author shows that the 'collective intelligence' of a group of individuals is superior to that of individual experts. This has relevance to why kaizen teams work effectively.

The author illustrates the 'wisdom of crowds' effect through many interesting examples such as competing in TV game shows, voting for political candidates, and maximizing stock market returns. While I would like to run a vector analysis on the data to make sure it holds up to six sigma standards of accuracy, from experience I agree with the author's conclusions.

One of the features of a successful kaizen team is that it is made up of people from varying disciplines. It is a true cross-functional team. Kaizen teams routinely achieve breakthrough results on problems that smaller groups of experts or specialists have been struggling with for years.

Part of this is that Lean manufacturing principles implemented during kaizen events are simple yet powerful and proven to be effective. Part of it is the cross-functional nature of the kaizen teams that tap into this 'wisdom of crowds'.

The reason for cross-functional kaizen teams is twofold. First, you can't have all of the team members from the target area of the kaizen event. If you do you will shut the process down. Everyone will be on the team, nobody will be doing any production.

Second, the diversity of experience and knowledge brings differing perspectives and information. People from outside the area are less swayed by a single opinion leader such as an experienced worker or supervisor. A variety of ideas and opinions, good and bad, tend to balance each other out by providing a wider range of options to test. The fact-based, hands-on, trial & improve approach of kaizen events insure that decisions are made rationally so the group can all agree which solution is better.

There is a rule of thumb that says a kaizen team should be made of people 1/3rd who are directly from the area being targeted by the kaizen event, another 1/3rd from customer or supplier processes (upstream and downstream) and the final 1/3rd from people completely outside of the area with possibly no direct link to that process.

This mix of people helps to insure that the "Wisdom of Crowds" effect can happen on a smaller scale. Instead of an engineering process flow redesign being done by a team of only engineers, the team membership is broadened to include people who will have other ideas, opinions, and questions. This prevents polarized opinions and coming to pre-conceived conclusions.

So if you're one of those smarter people who has the answer most of the time, pick up the book and consider how tapping into the collective insight of cross functional teams can help you make better decisions. Better yet, experience it by joining a kaizen team.

Posted by Jon Miller at 8:34 AM | Permalink | Comments (0)

As a resident of the Puget Sound area of Washington State, the subject of traffic flow is one of high interest to me. Traffic around the Seattle consistently ranks in the worst five in the United States. So a July 1, 2005 Wall Street Journal article titled "How Brief Drop in Cars Can Trigger Tie-Ups, And Other Traffic Tales" caught my attention.

The article describes some counterintuitive findings of traffic engineers. They make quite a bit of sense from a Lean thinking standpoint. In short, traffic jams can happen because individual cars try to speed up. This causes other cars to brake, resulting in more of the same behavior.

"Weaving" or looking for the open lane in a highway causes the reduction in road space since you can not occupy the empty spaces that cars are using to change lanes. This reduces overall capacity, slowing down traffic flow. When other cars are changing lanes in congested traffic you brake, resulting in more lane-seeking weaving behavior. The advice is to stay in your lane in congested traffic, and you will get there sooner. Slow and steady wins the race for everyone.

Weaving and lane changing causes more braking, creating a chain reaction and slowing down traffic overall. This has very interesting parallels to what we find in manufacturing, as well as supply chains. In complex manufacturing workflows, when the locally optimized processes with faster cycle times are allowed to "weave and change lanes" by producing ahead in batches, this creates the same type of overall slowdown in production throughput times.

The idea of Lean manufacturing is to keep the work moving smoothly and steadily rather than in short, quick responses. The goal is to have the lowest cost and the fastest speed overall, rather than highest utilizations or locally optimized processes.

In the words of Prof. Treiber quoted in the Wall Street Journal article, "If you brake just in time, you can usually safely break less," he says, "which improves the flow." Spoken like a true Lean thinker.

Traffic and workflow in a factory is certainly not a perfect analogy, but the next time you are in heavy traffic think about your lane-seeking behavior and the psychology of those around you. Compare it with how traditional resource allocation is done in manufacturing (as well as transactional work). Take the opportunity to practice Lean thinking on the highway to promote smooth one-piece flow of traffic.

Posted by Jon Miller at 6:34 AM | Permalink | Comments (0)