Archive for April, 2010

Mark Graban: Same Misunderstanding Occurs in Hospitals By Mark Graban, Author of the 'Lean Hospitals: Improving Quality, Patient Safety, and Employee Satisfaction,' winner of the Shingo Prize in 2009. Creator of leanblog.org, and Senior Fellow at the Lean Enterprise Institute. On twitter as @leanblog. - Last updated: Thursday, April 29, 2010

There's a fallacy in the question as stated - that "lean" means there's a major risk of not having what you need to get your work done. This is one way the word "lean" is sometimes misunderstood (going back to the  1980s book "Zero Inventories," the title of which was taken too literally by some). During my graduate school studies in the 1990s, I worked with a manufacturer who had taken "zero inventories" and what they thought was "lean" to an extreme. They slashed finished goods inventory and very soon after couldn't make shipments to customers! They had a process ...

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Art Smalley: Just in Time 101 By Art Smalley, author of Creating Level Pull and co-author of A3 Thinking - Last updated: Monday, April 26, 2010

Robert's question reminds me of the caption to an article in Business Week that I read on an airplane a few days ago. The article refers to the "perils of running too lean" and highlights how John Deere is losing sales due to a longer lead-time than the competition. The article implies that more inventory would automatically result in more sales and higher profits. I have no specific knowledge on the John Deere case and can't comment on that with any factual insight. I can highlight several common mistakes that are made regarding Toyota's Just-in-Time concept. For starters the Toyota Production ...

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Mike Rother: Use the Kata, Luke By Mike Rother, Author of Toyota Kata and co-author of Learning to See - Last updated: Saturday, April 24, 2010

I think Jeff Liker and Art Smalley give excellent explanations, in their posts above and below this one, of the interplay between process variation, inventory and continuous improvement. As Taiichi Ohno supposedly remarked, “You need enough inventory to hold the system together,” i.e., to match the current amount of variation in the processes in the value stream. Another key point is that since we cannot plan for every eventuality, how an organization is prepared to react to unexpected disruptions is highly significant. The way we react is, in many ways, the backup system for big disruptions. But perhaps most importantly... behind Rob’s ...

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Jeff Liker: Inventory Reflects Variation In the Process By Jeff Liker, author of The Toyota Way and co-author of Toyota Product Development System - Last updated: Thursday, April 22, 2010

One way to think about it is like a tight rope walker.  You would not want an amateur trying it without a net.  It takes a great deal of talent to earn you way to increasing the height and eventually eliminating the net.  The equation for calculating inventory in lean is pretty conventional--enough inventory to handle the replenishment time plus safety stock.  The amount of safety stock needed depends on how stable the consuming operation is and how stable the supplying operation is.  In other words, more variability means more need for inventory.  The goal of TPS is not zero ...

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Rob Austin: When Is Lean Too Lean? By Robert Austin, co-author of Artful Making - Last updated: Thursday, April 22, 2010

Dan Jones: Lean, Quality and Cost Cutting By Daniel T Jones, Co-author of 'Lean Thinking' and 'The Machine That Changed the World' - Last updated: Thursday, April 22, 2010

I have met many of these folks too who talk about lean but whose heads are stuck in the old cost cutting mind set. Organisations that employ them, whether as internal or external consultants, deserve what they get – traditional cost cutting! A great shame and a missed opportunity. On the other hand I have also met good lean folk who know all the tools but who do not have an A3 plan to guide their actions. And I often encounter quality folks who imply that improving quality is somehow more virtuous than the grubby task of eliminating waste, which ...

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Mike Rother: Getting a Better Understanding of How Toyota Operates By Mike Rother, Author of Toyota Kata and co-author of Learning to See - Last updated: Saturday, April 17, 2010

Now there's a revealing conundrum: Mike Micklewright asks, “Why Is Quality So Rarely Central in Lean?” He sees experts using Lean to increase efficiency and productivity, and reduce costs, without connection to quality. The word Lean is a name that in the late 1980’s we gave to what we observed at Toyota. Jeff Liker reminds us that over the last 50 years Toyota has virtually defined quality in the auto industry, and that quality is evident everywhere in the company. I think the answer to this puzzle is simple in hindsight:  We have been focusing on the what, the visible stuff that changes from ...

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Pascal Dennis: build the Toyota house By Pascal Dennis, Author of Getting The Right Things Done, Lean Production Simplified, and Andy & Me - Last updated: Thursday, April 15, 2010

Good question, Mike. Quality implied in the so-called “House of Lean” image, most obviously in the Jidoka “pillar”. But you’re raising a valid point. Too often Lean implementations underemphasize Jidoka & Quality, and overemphasize the other pillar (JIT). It’s understandable on some level – JIT seems “cooler” and promises quick payback in finished goods and WIP reduction. But the house, and our improvement activities, become imbalanced. We learn, eventually, that without Jidoka & Quality, you can’t provide the “right part at the right time in the right quantity”. So what’s the countermeasure? In my view, we need to respect the house metaphor — ...

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Michael Ballé: Quality = Sales is the hardest lean lesson for management By Michael Balle, co-author of The Gold Mine and The Lean Manager - Last updated: Wednesday, April 14, 2010

Thanks for asking the question – the difficulty in getting senior executives to focus on quality has to be my number one frustration with teaching lean (number two being people engagement). I have been puzzled for years how come all our Toyota teachers always started with quality, but somehow we never took that onboard as we did lead-time reduction or spot waste elimination. To my mind, the question is: why can’t we capture senior management’s interest on quality? The first issue appears to be the mindset of price = volume. In Ohno’s terms, I’m increasingly convinced that this is a misconception. ...

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Art Smalley: Does Lean Forget Quality at Times? By Art Smalley, author of Creating Level Pull and co-author of A3 Thinking - Last updated: Tuesday, April 13, 2010

This topic strikes a chord with comments I have made in the past regarding the state of Lean at least in the United States. Unfortunately I do feel that the Lean movement is often guilty of under emphasizing quality at times. Of course this is just a broad characterization and I am not speaking about my colleagues here on this site or directly about any company in particular. Let me try and explain my viewpoint. The Toyota Production System for many years was depicted as having two pillars. One was the famous Just-in-Time Pillar and the other was the less well ...

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Jim Huntzinger: Quality Is In The People By Jim Huntzinger, Author of 'Lean Cost Management: Accounting for Lean by Establishing Flow' - Last updated: Tuesday, April 13, 2010

As Mr. Micklewright points out one of the aspects of the lean business model is increasing productivity and efficiency – this is often the focus of many lean programs (program, unfortunately, instead of a business model).  This aspect is manifested in developing and implementing flow.  But quality is directly linked to flow, and this link is all too often missed, or ignored. In order to maintain good flow – that is constant and consistent flow (and ideally one-piece flow) – certain outcomes have to happen, and not just by circumstance; uptime on equipment, no long changeovers, consistent supply of the right ...

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Jeff Liker: Is Quality Central or Peripheral to Lean? By Jeff Liker, author of The Toyota Way and co-author of Toyota Product Development System - Last updated: Sunday, April 11, 2010

The most stunning accomplishment of Toyota over the last fifty years is their turnaround from making “junk” to virtually redefining quality in the auto industry.  They were influenced to the core by W. Edwards Deming and quality is evident everywhere in the company.  The objective of the Toyota Production System is presented as Quality, cost, delivery, safety and morale and any metric board in Toyota will include quality indicators. Every “lean consultant” or lean training course I know emphasizes quality.  In this sense I disagree with the questioner who claims lean focuses only on cost and efficiency.  On the other hand ...

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Mike Micklewright: Why Is Quality So Rarely Central In Lean? By Mike Micklewright, Author of 'Out of Another @#&*% Crisis!' - Last updated: Sunday, April 11, 2010

Dan Jones: Essential Lean and Six Sigma By Daniel T Jones, Co-author of 'Lean Thinking' and 'The Machine That Changed the World' - Last updated: Saturday, April 10, 2010

The fundamental power of the ideas behind Lean and Six Sigma are too important to be lost sight of as the improvement movements that champion them compete for attention. These ideas came together in a unique synthesis at Toyota in the 1960s as it was developing its business system. In my view they need to come together again as the rest of the world strives to realize their potential. What the Quality movement, of which Six Sigma is the latest incarnation, brought us is the idea that this is how we can use the scientific method to solve social as well ...

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Art Smalley: The Lean and Six Sigma Marriage By Art Smalley, author of Creating Level Pull and co-author of A3 Thinking - Last updated: Monday, April 5, 2010

I have witnessed plenty of Lean versus Six Sigma zealot arguments over the years at various client sites and at different conference settings. I think Tom is trying to stir the pot with this question :-) Somehow I seem to manage to find a way to offend both camps with my standard responses which I will outline below. I'll start my answer however with an interesting side story. Back around the year 2000 I was part of an effort in McKinsey & Company to look at what Fortune 100 companies were using for improvement methodologies. At that time we estimated that ...

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Mike Rother: How do We Want to Manage Our Organizations? By Mike Rother, Author of Toyota Kata and co-author of Learning to See - Last updated: Sunday, April 4, 2010

I think these kinds of questions about Lean versus Six Sigma are somewhat tangential, and don’t do much for addressing the more essential issue of, how do we want to manage our organizations? Several years ago there was a similar debate between “Agile Manufacturing” and “Lean.”  Eventually it got quiet around the agile topic, and it seemed to go away.  But agile continued on in the software development world and increasingly concerned itself with the question of, by what patterns should teams do work so that the product of that work meets customer needs?  Today agile is about using the scientific ...

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Michael Ballé: Program vs System: Lean’s ambition is to propose a full business model, not just a productivity improvement program By Michael Balle, co-author of The Gold Mine and The Lean Manager - Last updated: Sunday, April 4, 2010

A few years ago, at the first French Lean Summit, one participant would stand up at the end of every presentation and ask “what about six sigma? Couldn’t this be done better with six sigma?” – until José Ferro, President of the Lean Institute Brasil answered with his incomparable charm that he didn’t feel competent to answer, having never worked with six sigma, but that the Toyota veterans he knew absolutely hated six sigma for its anti-teamwork spirit. The idea of having a green belt or black belt present to senior management the work of an entire team, he explained, ...

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Steve Spear: Designing, Operating, and Improving Complex Systems: Common Challenges–>Common Responses By Steven Spear, Author of 'The High-Velocity Edge' and 'Chasing the Rabbit' - Last updated: Sunday, April 4, 2010

TQM, six sigma, lean, TPS, and the like stem from different sources but nevertheless share common approaches because they are responses to a common challenge: managing the design, operation, and improvement of complex systems of work--many people, spanning many disciplines, using multiple technologies, to deliver value to the market. This is so challenging because the design of any complex system is a product of imperfect people's creative efforts.  Hence, the initial design is imperfect and needs to be improved relentlessly. Therefore, all these approaches have some element of rigor in: • the design of work to reduce variation and to help distinguish between ...

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Jeff Liker: All Companies Need Problem Solving Tools Based On Deming’s PDCA By Jeff Liker, author of The Toyota Way and co-author of Toyota Product Development System - Last updated: Sunday, April 4, 2010

The relationship between lean and six sigma  is one of my favorite topics....Not!  It is fitting that this question came at Easter time which is famous for the Easter egg hunt.  Let's assume that lean eggs are red ones and  six sigma eggs are blue ones.  If you gather only the red eggs you will have an imbalance.  It will allow you to gather the eggs very quickly and efficiently but the red eggs are all different sizes and therefore there is a lot of variation.  On the other hand the blue eggs are very uniform so gathering some of ...

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Tom Ehrenfeld: How do Six Sigma and Lean fit together? By Tom Ehrenfeld, author of The Startup Garden and A Leader's Study Guide To The Gold Mine - Last updated: Sunday, April 4, 2010

Pascal Dennis: Safety was always first at Toyota By Pascal Dennis, Author of Getting The Right Things Done, Lean Production Simplified, and Andy & Me - Last updated: Saturday, April 3, 2010

Dear Dr. Shein, It’s a pleasure indeed to get a question from you. In my personal experience at Toyota, I found that Safety, pardon the cliche, was always first. First thing discussed at morning production meetings, weekly status reviews, mid-year and year-end reviews. Significant safety incidents including near misses were investigated within 48 hours. Report outs, or “Safety Auctions”, were lead lineside, usually by the group leader and responsible manager. These investigations went far deeper than in any other company I know, with the possible exception of Dupont. In new model launches, safety and ergonomics, were, again, the first order of business. Once ...

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