Winning the Lean Game

Learn how to follow the Toyota Production System rules

I recently read “Decoding the DNA of the Toyota Production System” by Steven Spear and H. Kent Bowens in the Harvard Business Review. This article is the result of a four-year study of the Toyota Production System (TPS), which also goes by the handle, “lean production.” I stop way short of suggesting this piece of writing tells us everything we need to know about TPS, but I do think many of the aspects covered therein provide a solid foundation for a world-class operation.

Unless you’ve been in Siberia without internet connectivity for the last 20 years, you’ve heard and read a lot about lean production and TPS. In fact, at least two-thirds of the APICS members I meet, work in organizations that are or will be implementing some form of TPS in the very near future. Some are even on their third or fourth go-round. In my experience, however, only 8 or 9 out of every 10 organizations that pursue TPS and lean fail to get the benefits they should.

Authors Spear and Bowens postulate that Toyota has been largely successful by creating a community of scientists who engage everyone in the company on a continuous basis to follow just four basic rules for continual process improvement:

1. All work shall be highly specified as to content, sequence, timing and outcome.
2. Every customer-supplier connection must be direct, and there must be an unambiguous “yes or no” way to send requests and receive responses.
3. The pathway for every product and service must be simple and direct.
4. Any improvement must be made in accordance with the scientific method under the guidance of a teaching, at the lowest level in the organization.

Rule 1

Toyota leaders leave nothing to chance. That is one of the reasons why the quality of their results is so outstanding. Supervisors go into the workplace and quiz individual employees on how their work is done, their effectiveness and any issues they encounter along the way. The degree to which the right answers are forthcoming is a measure of teacher effectiveness, not that of the workers. Everyone in Toyota is continually mentored—at all levels—to challenge assumptions and improve processes. This is a critical point that management professionals from western operations tend to miss.

Rule 2

Making every customer-supplier connection direct seems simple enough at face value. However, as the authors accurately point out in the article, people tend to give this rule lip service at best. Think about it: do the employees in your organization have a clear path to answers within the value chains? If they have to spend any time at all choosing among two or more sources of information to solve a problem, your firm is falling short of the ideal this rule suggests.

At Toyota, how people connect in the supplier-customer relationship is never left to chance or a decision-making process. Not only is the means to find needed answers apparent, employees know exactly how long it should take to get those answers. This is a critical consideration if you are committed to operating at a pace of work tied to customer demand, or Takt time.

Toyota also has a predefined chain of action that unites everyone in a hierarchical way. The lowest-level employee can have a problem escalated all the way to the plant manager and above in an incredibly short time, and only three to five handoffs occur before a problem is resolved.

Rule 3

Every product requires a simple and direct path for anyone serious about supply chain or value stream management. This rule is partly behind Toyota decision-makers’ fixation with mapping out all processes in excruciating detail and then relentlessly eliminating any process steps that don’t add value. In fact, Toyota professionals go way beyond simple process mapping and examine each step against key metrics.

I had the great privilege to work side-by-side with Toyota-trained engineers and teachers many years ago on an effort at Ford Motor Company. For each of the major process steps, we detailed performance against six metrics: safety, quality, delivery, cost, morale, and productivity. Each data box included a Takt time, staffing details and a bevy of additional relevant information. We determined if the steps needed to exist at all, and, if so, what was the current identifiable performance gap in the process for each one.

Rule 4

The last rule deals with following a scientific method, under the guidance of a teaching, at the lowest level in your organization. This, my friend, is where most business people I know will balk. This rule implies willingness and ability to teach everyone in your organization how to make changes within the framework and infrastructure of a truly effective continuous improvement program—both inside and outside the four walls of the organization and across the entire supply chain. It also requires a work environment and culture that continuously challenges everyone to improve processes.

How important is this? Well, let me share a true story relayed to me by one of my mentors, who was on a tour more than 10 years ago at the Toyota plant in Lexington, Kentucky. As the story goes, my friend (who worked for Delphi, then a division of General Motors) noticed that there were people from Chrysler and Ford Motor Company on this tour as well. He pulled aside the tour guide privately and asked, “Why would you allow your competitors to come in here and see what you are doing?”

The tour guide replied, “By the time they figure out what we’re doing now and start doing it, we’ll be years ahead of them.” On the surface, this sounds like a very smug remark. I disagree. The tour guide obviously understood Toyota’s continual improvement culture and the rate of change that is accomplished.

Some questions for you

How would you go about applying the rules described here to a producer-supplier interaction for which the two parties are not in the same facility? Would this be possible to do in a way that fosters a community of scientists performing continual experiments in your supply chain? I hope to hear from many of you with your thoughts and ideas.