This month I am putting together the final touches in preparation for my trip to Japan in April 2018, attending the “Japan Lean Experience” with my colleagues from Tokyo .
This will be my fourth week long homage to the spiritual home of Kaizen and Lean thinking, and I will be traveling with a small band of brothers from NZ seeking inspiration from the world’s leading practitioners of Lean Management.
Our variety of factory tours provide a perfect combination of education, exposure to best-in-class Lean practices, unique relationship building, in-depth tours, interactive discussion, and comfort.
In addition to the formal tours, there will be time to take in some sights and experience Japan culture and of course a ride on the bullet train!
The Shinkansen, or Bullet Train cruises at between 280-320KPH and is one of those experiences that is not to be missed. I confess that this for me is one of the highlights, and epitomizes what Japan is all about, efficient, reliable, high quality and on time!
Of course, we have the home of 5S, with everything in it’s place, and a place for everything, there is so much inspiration in their factories, offices and even around town!
Japan also has history and culture by the bucket load and there are some amazing things to see and visit whilst you make your way around.
I’ll be adding a few extra days to the tour and our group will take in some of the sights. A personal favourite is Kyoto, the ancient capital, and a deeply religious place.
It is also a place that brings home some of the things that mankind is not so proud of, the atomic bomb. I recommend a visit to Hiroshima for a poignant reminder of the horror of war and devastation it brings.
Finally, there’s plenty of great food to try and taste. I am pleased to announce that Japan has pizza and pasta and Hagen Daas ice cream, but the local cuisine is very special and well worth a try!
In the same week as our Continuous Improvement conference hosted at Massey University, Chris Butterworth, MD Asia Pacific, led our world class, Lean Leadership seminar in Auckland.
This two-day workshop is designed for business leaders and senior managers looking to embed continuous improvement practices in their organisations, and Chris shares how to create a sustainable continuous improvement culture in addition to the tangible benefits from Lean.
Chris brings a wealth of experience and case studies relevant to NZ organisations who are starting the Lean journey and wish to understand the role that leadership plays in embedding continuous improvement principles as part of the “way of life”.
Many thanks to Chris for bringing Lean to life and sharing his expertise and we’ll look forward to Oct, when he’ll be back!
Workshop Outcomes:
Learn how these results are built upon and sustained also how to engage the workforce and create a sustainable Lean culture.
Understand how Lean thinking provides the basis for a profitable, growing and customer focused business
Understand the key elements of creating a sustainable culture of continuous improvement
Identify the priority actions to achieve this vision and start developing a roadmap to get you there
Understand the role of the senior team in creating a Lean enterprise
Early April saw 16 participants for our Discover Shingo Awareness seminar, kindly hosted by Auckland Leisure and presented expertly by S A Partners.
Our Shingo training is brought to our clients as we are a fully affiliated to the Shingo Institute https://www.shingoprize.org/
The Shingo Training Discover Excellence programme is a foundational, two day workshop that introduces the Shingo Guiding Principles and the Three Insights to Enterprise Excellence. It is designed to raise awareness amongst Leaders and Managers on how Enterprise Excellence can benefit their organisation.
The course is a blend of expert input, discussion and best practice learning combined with real time application of learning via “Go and See” assessments.
On this occasion we were hosted at West Wave Recreation and Leisure Centre which gave the participants the opportunity to apply the learning first hand, to see how Shingo principles drive behaviour throughout the entire organisation to deliver world class results.
At the end of this Shingo workshop participants were be able to:
Understand the principles of enterprise excellence.
Learn the key insights of ideal behaviours.
Understand the relationship between behaviours, systems and principles.
Learn how systems and behaviours drive results.
Learn how KBI’s drive KPI’s and how this leads to excellent results.
Use “Go and See” to understand the practical application of the Shingo Guiding Principles.
Many thanks to Chris for the opportunity to get to grips with Shingo and we look forward to next time and further Shingo insights on your next visits.
We are in the early stages of lining up a great selection of key note speakers and stream activities including additional speakers and workshop activities to make the day informative, engaging and fun. Our current line up includes:
Dr Morgan Jones – Commonwealth Bank of Australia
Paul Salmon – Lean IT
Chris Till – HR Institute NZ
Farah Palmer – Former Captain, Black Ferms
Adam Bentley – Countdown Supermarkets
Rob McGee – Auckland Leisure
We are finalising the full programme this month and aim to have the full details ready in early March.
So mark the diary and join us on the 30th August to join the throng!
Auckland, Sept 7th saw our second annual Continuous Improvement Conference, hosted in partnership with Massey University and Minitab (presentations available for download below).
Above, Chris Butterworth gives the opening keynote speech to over 80 attendees there on the day, and it was a great opportunity to hear some great stories, learn from others and the lunch was quite good too!
This year’s theme’s were on how to sustain enterprise excellence and some of the leadership challenges in engaging employees in improving value for the customer.
Here’s some of the comments from the attendees:
“Excellent day, good speakers that focused on the Continuous Improvement message over a good variety of industries”
“This was a great session. Affirmation of what I’m doing is correct. Left with some new ideas to implement”
” Great diversity of presentation and content, using real situations, not just theoretical principles, really enjoyed the day!”
Those that came in our inaugural year commented that they enjoyed the diverse speakers, in particular Mark Powell, Massey and Chris Till from HRINZ, who complimented other speakers who shared their Continuous Improvement stories.
Feedback was very good and in the spirit of Continuous Improvement the Massey and SA Partners team will look to work together on other events and opportunities to showcase empowering people and organisations to reach new levels of performance.
Things that are good for the planet are also good for business. Numerous studies from the likes of the Economist Intelligence Unit, Harvard, MIT Sloan, and others indicate that organizations that commit to goals of zero waste, zero harmful emissions, and zero use of nonrenewable resources clearly outperform their competition.
Like lean thinking, greening your business is not just a ‘nice to have’; at least not anymore. It is now a key economic driver for many forward looking firms. This book is packed with case studies and examples that illustrate how leading firms use lean and green as simultaneous sources of inspiration in various sectors of industry – from automotive and retail to textile and brewing. Take Toyota as an example, the holy grail of economic efficiency for decades. This book, shows that Toyota tops the green chart too, describing Toyota’s notion of Monozukuri: sustainable manufacturing.
Creating a Lean and Green Business System: Techniques for Improving Profits and Sustainability offers opportunities for innovation that can simultaneously reduce dependence on natural resources and enhance global prosperity. It explores less understood aspects of lean and green – discussing their evolution independently as well as the opportunities that exist in their integration, highlighting the importance of a cultural shift across the whole company.
Outlining a systematic way to eliminate harmful waste while generating green value, the book explains how to:
Become economically successful and environmentally sustainable by adopting the lean and green business system model
Adopt a systematic approach to become lean and green, and develop your own roadmap to success
Use the cutting edge tools, techniques, and methodologies developed by the authors
Translate the techniques and culture that underpin lean into environmental improvements
Creating a Lean and Green Business System: Techniques for Improving Profits and Sustainability supplies a new way of thinking that will allow you to boost improvement efforts and create a positively charged work environment – while contributing to the long-term well-being of the environment.
The Food & Drink Sector in the UK is the single, largest manufacturing sector with a turnover of around £95Bn per annum, accounting for 18% of the total manufacturing activity within the UK. It employs over 400,000 workers – almost 17% of the total manufacturing workforce within the UK and it is these people who have increased productivity within the sector by over 12% during the past 10 years or so.
For more than 20 years, S A Partners have been working in this important sector, with UK and multi-national companies. We are currently working on 45 strategic, tactical and continuous improvement programmes with companies whose products grace the shelves of luxury and best value retailers, and the store cupboards of consumers across the globe.
For the companies to remain competitive in global markets, they must be resource efficient, innovative and resilient whilst maintaining a safe and secure food manufacturing supply chain.
In the interview Jeff explains the importance of having an ‘end to end’ system in place in order to sustain business excellence in an organisation. When organisations are asked the question: ‘show me the end to end system, that is driven by targets, visual management, boards etc’ that end to end system is usually missing.
Jeff goes on to explain that engaging the shop floor in the continuous improvement process is critical to its long term success and sustainability.
If you require more information about our services to the Food and Drink sector, please contact Jeff Williams by e-mail.
Peter Hines’ Business Model drives us to think of lean differently. I have been around Lean for the past 20 years. It started off as being map your business to death, implement 5s, have a go at Kanban, then try OEE, then if your still going do Total Productive Maintenance (TPM), the most enlighten of us graduated to supplier bashing demanding price reductions and vendor maintained inventory. We took a very crass journey across the horizontal axis of the business model -value stream mapping tool implementation and then supply chain price reductions.
Sustainable transformation is obviously much more holistic and planned in its approach. The business model shows us that true transformation results from aligning our strategy, engaging our people, use systems and not tools to improve our business, utilise the extended enterprise both to customers and suppliers. Lean is a very simple concept – 5 principles based around engaging our people and applying common sense. It is though, often confused with tools and used in isolation – use Lean to initiate a change in your business, turn your lean programme into your continuous improvement programme and finally admit you are here to work better and deliver more benefit to your employees and customers and then you are onto a winner.
Creating new ways for profitable sustainability requires participation from the best. For the first time a number of leading edge companies and thought leaders have come together to share their knowledge and best practice across different industry sectors. The Lean and Sustainable Industry Consortium, is now established with participation from companies such as Nike, Adnams, Mars, Vale, Accolade Wines, Toyota, Sakab and several other industry leaders.
On 8th October the group met in Southwold, UK to learn from Adnams. Adnams CEO, Dr. Andy Wood, OBE explained company’s journey and how principles of lean and sustainable thinking have boosted company’s profitability for decades. Since this was the consortium’s first ever Gemba Exchange, participants spent some time discussing about the consortium’s structure, vision and activities over the next 12 months. There will be four Gemba Exchanges per year, development of a bespoke lean & sustainable roadmap for each member, on-site Gemba coaching and an ongoing online forum as well as a number of other membership benefits.
To join this new exciting network, or to find out more you can download the brochure, visit the consortium webpage and contact info@enterprizeexcellence.com. The lean and green consortium is governed a by its board of directors, currently consisting of Dr. Wood of Adnams PLC (Chairman of the board), Dr. Zokaei and Prof Hines from S A Partners, and Hunter Lovins from Natural Capitalism Solutions.
How often have we heard that 5s, OEE and SMED are all old hat and past their sell by date. There is nothing wrong with 5s, OEE and SMED, they are all fabulous tools and all can deliver great results. The problem arises when the tools are used at the wrong point in the improvement journey of a business.
Within a lean transformation we need to develop improvement systems that address what is in front of us and what needs to be improved. We need to consider the long game. I have seen companies survey their customers when they have not stabilised their operation. The salesman comes back with a load of great things to do, but we have not capacity to do them, as a result we do nothing – other than disappoint our customers.
Customer management should be considered as a system, first fix QCD, once QCD is stable, talk to them about what they would like in addition-customer value surveys, so a stabilised process is developed, now we can look at market research and the completion to further develop, once this has delivered we can then think about integrating our offer further with the customer….timeframe for this 5 years.
We need to look at our business and identify what are our business critical processes then develop improvement systems around these. We should consider our long term plans within these systems and designed the appropriate tool implementation logic to ensure the journey is a success.
The customer is at the heart of almost all contemporary management approaches that have emerged over the last few decades – lean, six sigma, BPR, TQM, JIT, ToC to name but a few. Customer value is first, and arguably most important, of the five lean principles. The five lean principles first appeared in Womack and Jones’ seminal text of 1996, Lean Thinking. They are:
Specify value in the eyes of the customer
Identify the value stream
Make the value-creating steps flow
Let customers pull value
Continually strive for perfection
Customer value, in spite of being the first and most important of the lean principles, is probably the least understood. Consequently companies often ignore it opting instead to work on mapping their far more visible value streams. More often than not this is for a want of approach or technique to tackle customer value. Broadly, the lean world is awash with an array of different tools and techniques. See, for example, John Bicheno’s many toolbox publications. The over-abundance of lean tools brings with it two main problems: first, a perception that lean is all about tools rather than an holistic systems approach to business management; second, dilution of the really powerful tools amongst the many. Having argued that there are probably too many lean tools around, customer value is an area in which a tool, or rather a systematic approach, is lacking and urgently needed. Many companies would benefit from a periodic review of customer value – one that offers real depth of understanding, not the superficial and often meaningless information gathered through customer service surveys.
At S A Partners we have been experimenting with such an approach for a number of years. We have tested our approach with a number of our more adventurous clients and have been pleasantly surprised at the insight that our clients gain from this approach. For some clients it has led to a re-think of the basic elements of their prevailing strategy. In all cases, clients have learned something new about what their customer really value.
Our confidence in our systematic customer value (or Voice of the Customer) approach has grown such that we are now ready to share it with the wider lean community. We hope it will trigger debate and generate greater activity around customer value. In our forthcoming webinar my colleague, Steve Baker, will explain our approach and provide case study examples from both large multinationals and small enterprises.
Too many companies read a book, go to Toyota or get bullied by their customers into “doing lean”. Invariably these companies fail as they copy another organisations approach. We all know our people are different and cultures individual –so why copy?
We have developed the S A Partners improvement journey and coupled this with Peter Hines’s lean business model to help us understand where an organisation is on its change journey. We have defined the maturity conditions from reactive to way of life to enable us to correctly diagnose the organisation and what needs to be done to improve it.
Often, mature solutions are copied without the management rigor and commitment behind them, they thus lack the robust foundations to make them stick. In addition, we see companies doing too much too soon, throwing everything at the organisation instead of focusing on the key issues. Finally the worst disease of all is the Company that is “doing lean” because it has to. For me we need to commit or stop, Lean can be fantastic, but don’t play with it.
Would you take a headache tablet to fix a broken leg?
As you may have read in my previous blogs, Lean is rapidly evolving. It is moving past the traditional tools and one off events stage. People are also challenging whether the original concepts we learned about in the last century are really right. One of these is how far you can take lean, or the frequent question: what is after lean? My response is: doing it properly and across the whole organisation and so create a sustainable Lean Business System.
For those of you not familiar with the series and the idea of the Principles behind the Lean Business System, I will just summarise for you:
I believe it is a more holistic or systems based approach balancing traditional hard methods within multiple processes as well as a range of enabling mechanisms within the strategy deployment, leadership and engagement areas of work. In other words thesecret lies in thinking about Lean less in simple cost reduction terms and more as a way of thinking, behaving and improving, impacting on every aspect of work inside a business. I call this a Lean Business System.
So how do you go about developing this modern lean approach? Those of you that read my previous blogs will know that I believe the starting place is not copying some exemplar such as Toyota who almost certainly is in a different industry, faced with different circumstances and at a different stage of its evolution. What is needed is to start from a simple set of Lean Principles that can be applied to any industry and using this to guide your journey. Having learned from 25 years of application of lean I have defined 8 such principles: the 8Ps of the Lean Business System.
This framework helps companies in any industry, and at any stage of Lean maturity, to reflect on how they are deploying Lean in their business. It helps to take the focus away from point-kaizen activity towards a more contingent approach, a more aligned approach, a more human approach and ultimately, a more sustainable approach. Indeed it is part of a move to Lean becoming a cultural journey towards everyone in the organisation actively working towards a fully aligned ‘tomorrow better than today’ system.
Perfection has been the ‘holy grail’ for Lean businesses since Womack and Jones encapsulated this principle in the mid 1990s. Their 1980/90s automotive research work showed us that there were huge gaps between the best and other companies. The gap was often between Toyota (or its supply chain) and western equivalents.
This benchmarking gave many western companies a wake up call. However, it had two major problems in terms of energising organisations. First, partly because the gaps were so big, many organisations, particularly outside of the automotive sector, found it hard to accept the data. This led to reasons for inaction such as “they have a different culture, “it is a different industry” and “we are different”.
Second, even those who were compelled by the data, lacked a roadmap of how to move forward. As a result many organisations, often guided by external consultants, simply followed the quick fix kaizen blitz route leading in many cases to a poorly sustained short-term Lean initiative.
To counter this piecemeal approach, we believe that organisations should create their own Lean Business System. This requires them to develop a vision of their specific perfection and their own bespoke roadmap on how to move towards it. But how?
Simply put, the process is similar to best practice Value Stream Mapping, except here we are working at the business, rather than the Value Stream or process level. As seen below you start with establishing the Current State for the business. You then envision Perfection, or the Ideal State (or what you think is the best possible position you could possibly reach). You then back off from this to a point that your team believe is feasible in the long term. This Feasible Future State might be 3 to 5 years away.
The next step is then to create a realistic point that can be reached within a sensible engaging timescale (usually around 18 months). This is the Targeted Future State that then requires a Roadmap. Once this Targeted Future State position is achieved, a further Roadmap towards the Ideal State may then be created and deployed.
To help, we have developed the Lean Business Model® which not only provides a framework for an organisation’s particular Lean Business System but also an associated diagnostic tool that helps the organisation to see where they are in a journey and which interventions should be done early and which done later.
To start creating the Lean Business System [1] it is necessary to follow the steps described above for each element of the Lean Business Model®. It is not just about taking each element a bit further in each Roadmap, but about making discriminating choices of what to do at what point in time. Indeed, the more difficult choice is what not to do in the first Roadmap, as trying to do everything at once will lead to delays, frustration and poor sustainability.
The measurement system associated with this is based on the academically proven Five Key Milestones of Continuous Improvement Maturity from “ad-hoc” through to “way of life”. Each of the core elements of the Lean Business Model® is assessed not only from a quantitative viewpoint of – systems and procedures – but also from a qualitative viewpoint of – values and behaviours.
In other words we need to measure not just what you do but also (and more importantly) the way that you do it. This helps to build a learning organisation that not only has the capability to maintain the gains of the improvement but is also self-propelled continuously to improve the continuous improvement process until it becomes a daily habit for everyone.
For further information about this blog series or the accompanying webinar series please contact Dr Donna Samuel, donna.samuel@sapartners.uk the series manager.
Amidst the barrage of Japanese terminology and the many tools and techniques that occupy the lean world, it is sometimes easy to forget that lean is fundamentally about the power of simplicity. It sounds trite, but when you consider the increasingly complex world that organisations face, it is not surprising that their response is invariably more customisation, more tailoring and more sophistication. Individually these responses are likely to be completely rational decisions but collectively they can generate tremendous organisational complexity, which may begin then to negatively impact overall business performance.
At S A Partners our preferred approach to cutting across organisational complexity, is to address purpose, process and people, in that order (the vertical axis of our Lean Business Model®). This approach enables us to address the common causes of organisation complexity which are typically:
Proliferation of products/services
Inconsistent and overlapping processes
Misaligned incentives
Inappropriate organisational structures
To hear more about the S A Partners approach, join Professor Peter Hines at Aimia Foods. Aimia Foods won the Best Factory Award in 2012. They are an explemplar lean facility and generous in sharing insights into their improvement journey so far.
Staying Lean: Thriving, not just surviving has just been awarded a Shingo Prize for Operational Excellence 2009, in the Research and Professional Publication category. The book draws on the story of a multi-national company that has successfully implemented Lean in its manufacturing and commercial areas to help turnaround the organisation s financial performance.
The story is based around the Lean Iceberg Model of sustainable change and addresses the often invisible, and hard to copy, enabling elements of successful Lean Management in manufacturing organisations: Strategy and Alignment, Leadership, Behaviour and Engagement as well as the more visible features: Process Management and the application of Lean Technology, Value Stream Tools and Techniques. Staying Lean is designed to be used as a practical workbook to guide practitioners along their own Lean journey so that Lean becomes embedded in the organisation and sustains the performance improvements over the long-term; often enabling them to outperform low-cost economies and thus compete in a global marketplace.
The Lean Enterprise is an in-depth study of what it is to be lean, and how to do it. In a lean enterprise, management fuses the core competencies and expertise of the company and its external partners, and focuses on a vital few “strategic processes, ” with the goal of delivering superior value to customers.
The Lean Enterprise presents this groundbreaking system through the recent and often radical experiences of Western firms facing swift and aggressive competitors in the global economy. With years of research and observation behind them in the United States, Europe, and Japan, authors Dan Dimancescu, Peter Hines, and Nick Rich offer a multidimensional view into the implementation of strategic processes. The Lean Enterprise makes a strong case for implementation of the three-tier system by companies of any size.
Backed by their research at the Cardiff Business School’s Lean Enterprise Research Center, the authors highlight several unique British firms whose implementation of the system speaks to the rapid and dynamic evolution of the Welsh and English economies.
This book is aimed at any manager interested in sustaining growth within their industry. They define “lean thinking” as the elimination of unnecessary waste in business, and by outlining the principles and applications of this, they link their theories to value for the customer.
Womack and Jones demonstrate the effectiveness of their approach through their research in both the U.S. and Europe. Citing examples from both simple and complex manufacturing processes, and from traditional technologies to high-tech companies, they show how their theories have been put into action.
Based on the belief that companies should compete against perfection rather than each other, Lean Thinking provides a valuable new insight into methods of production management. And by applying the theories outlined in this book, managers across all sectors of the economy will be able to reduce waste and increase profitability.
The Lean Toolbox 4th Edition, the Essential Guide to Lean Transformation’ is written for practitioners and for students, and is the extensively revised version of the best selling ‘The New Lean Toolbox’.
The book has sections on The Philosophy of Lean, Value and Waste, Transformation Frameworks, Deployment, Preparing for Flow, Mapping, Layout and Cell Design, Scheduling, TOC, Quality, Improvement, Managing Change, Sustainability, New Product Development, The Lean Supply Chain, and Accounting and Measurement.
The Lean Toolbox for Service Systems is the first book that attempts to assemble a comprehensive set of tools for lean service and administration. Other publications have dealt with only a segment of the tools or a segment of the range of service systems. The book is a result of several years’ work in Lean Service at the Lean Enterprise Research Centre, Cardiff Business School, and the service management programme at the University of Buckingham.
All material in the book has been ‘field tested’ by exposure to service professionals and executive programmes. A feature of the book is that it integrates several approaches rather than advocating a particular approach. Attention is given to general Lean service concepts and frameworks, to mapping and understanding different types of service system, and to a range of tools that have been found to be useful in a variety of service environments.
The Machine That Changed the World: The Story of Lean Production– Toyota’s Secret Weapon in the Global Car Wars That Is Now Revolutionizing
Based upon MIT’s five-million-dollar, five-year study on the future of the automobile, a groundbreaking analysis of the worldwide move from mass production to lean production”.The fundamentals of this system are applicable to every industry across the globe…[and] will have a profound impact on human society–it will truly change the world”. “–New York Times Magazine”.
Since The Machine that Changed the World (1991) defined lean production (based on the model of the Toyota Production System) as the next new paradigm of management since the mass production revolution, lean has spread from automotive, to the rest of industry globally, to defense, to financial services, to government, to health care, and more. As it expanded globally we have learned to think more deeply about lean as a way of linking a company’s business strategy to operational excellence through a culture of continuous improvement. Lean organizations constantly surface problems, find the root cause (Plan), attempt countermeasures (Do), check what happened, and act on what they learned (PDCA). The role of leadership in a lean organization is to live the values, show the way, and develop others to improve processes using PDCA through daily coaching.
Unfortunately, there is no quick-fix recipe to transform leaders from a short-term focus on quarterly returns to a long-term focus on developing people to achieve operational excellence. The typical leader is almost 180 degrees away from a model of lean leadership. Changing values and leadership behavior is every bit as challenging as trying to convince overweight people to change their lifestyle to healthy eating and regular exercise.
They must want it badly and transform themselves. Leaders that succeed in changing themselves to lead, teach, and coach on the long-term journey to continuous improvement throughout the organization will change the game in their industry. In this book we define a model of lean leadership based on Gary’s 25 years of experience with NUMMI, Toyota, and then as CEO of Dana and Jeff’s 30 years of deep study of Toyota. We explain the model through stories from our collective experiences and give practical advice for the long hard road leaders must commit to in order to truly self develop.
Bill Bellows, Associate Fellow at Pratt & Whitney Rocketdyne, reviews ‘Creating a Lean and Green Business System’ by Keivan Zokaei, Hunter Lovins, Andy Wood and Peter Hines.
“The boundary of the system…may be drawn around a single company, or around an industry, or as in Japan in 1950, the whole country. The bigger be the coverage, the bigger be the possible benefits, but the more difficult to manage. The aim must include the future.” W. Edwards Deming, The New Economics
Beginning with his first visit to Japan in 1946, Dr. W. Edwards Deming encouraged organizations to see their internal operations as a system, with an endless connection to suppliers and customers. According to Dr. Deming, management of an organization or a work group requires management of the parts and management of the relationships among the parts of the organization.
In doing so, his cyclical model for seeing production as a system bears a strong resemblance to the cyclical model used by environmentalists to remind us that “what goes around, comes around.”
Amongst the hundreds of executives inspired by Deming during his 1950 lecture series was Shoichiro Toyoda, whose efforts to improve the quality of Toyota’s automobiles led to a Total Quality Control effort that is integral today to Toyota’s Production System. Fast forward to 1991, when Toyoda offered this testimony, “There is not a day I don’t think about what Dr. Deming meant to us. Deming is the core of our management.”
The ability to see the parallels between “Lean” and “Green” may be lost on those who associate Lean narrowly with a multitude of tools and techniques of industrial engineering, many copied from Toyota’s renowned Production System, and those who associate “Green” with a primary focus on one relationship, with the environment, and focus less on relationships with employees, suppliers, customers, and the communities in which they operate.
In writing Creating a Lean and Green Business System, Keivan, Hunter, Andy, and Peter have provided a highly valuable beginners guide to the possibilities that may emerge when Lean practitioners look beyond their tool box and focus on the environment, the open system their organization operates within.
With a generous basic perspective on both Lean and Green, the authors have also provided an invaluable guide for “Green” advocates to expand their environmental systems perspectives to include systems that operate within organizations.
Beyond the well-documented basics of both Lean and Green, the authors progress from essential theory and informative background to highly detailed and wide-ranging application examples, beneficial to both newcomers and experienced practitioners.
The dedicated chapter-length accounts of how three well-known companies, Adnams, Tesco, and Marks and Spencers, continuously engage employees to seek new opportunities for investment, provide easy to understand examples and explanations that a sustained systemic view of organizations yields results that can be measured in terms of undeniable superior profitability.
The financial results of these efforts represent the essence of sustaining any new order of thinking for how organizations operate. These accounts and evidence provided by this book offer an exciting reminder from Dr. Deming to Lean and Green leaders that “The bigger be the coverage, the bigger be the possible benefits.”
As you may have read in my previous blogs, Lean is rapidly evolving. It is moving past the traditional tools and one off events stage. People are also challenging whether the original concepts we learned about in the last century are really right. One of these is the lack of focus on being a corporate citizen and our wider responsibility to society and the environment. In today’s business environment this area can no longer be ignored.
For those of you not familiar with the series and the idea of the Principles behind the Lean Business System, I will just summarise for you:
I believe it is a more holistic or systems based approach balancing traditional hard methods within multiple processes as well as a range of enabling mechanisms within the strategy deployment, leadership and engagement areas of work. In other words the secret lies in thinking about Lean less in simple cost reduction terms and more as a way of thinking, behaving and improving, impacting on every aspect of work inside a business. I call this a Lean Business System.
So how do you go about developing this modern lean approach? Those of you that read my previous blogs will know that I believe the starting place is not copying some exemplar such as Toyota who almost certainly is in a different industry, faced with different circumstances and at a different stage of its evolution. What is needed is to start from a simple set of Lean Principles that can be applied to any industry and using this to guide your journey. Having learned from 25 years of application of lean I have defined 8 such principles: the 8Ps of the Lean Business System.
This framework helps companies in any industry, and at any stage of Lean maturity, to reflect on how they are deploying Lean in their business. It helps to take the focus away from point-kaizen activity towards a more contingent approach, a more aligned approach, a more human approach and ultimately, a more sustainable approach. Indeed it is part of a move to Lean becoming a cultural journey towards everyone in the organisation actively working towards a fully aligned ‘tomorrow better than today’ system.
It was just after the turn of the millennium that Jim Womack wrote:
“Lean thinking must be “green” because it reduces the amount of energy and wasted by-products required to produce a given product…Indeed, examples are often cited of reducing human effort, space, and scrap by 50 percent or more, per product produced, through applying lean principles in an organisation….this means that…lean’s role is to be green’s critical enabler as the massive waste in our current practices is reduce.”
One of the first to put the green agenda on the map was the then Norwegian Prime Minister, Dr Gro Harlem Bruntland when she introduced the concept of sustainable development, describing it as being made up of three areas: economic, social and environmental sustainability.
For a company we might translate this as a focus on a ‘respect for profit’ (economic), ‘respect for people’ (social) and ‘respect for environment’ (environmental). To think in very simple terms:
A traditional Lean approach might be described as understanding customer’s needs and values and then reviewing the system and processes that produces them so that the traditional eight wastes can be minimised
Green might be described as understanding society’s needs and values and then reviewing the system and processes that delivers them so that the eight environmental wastes can be minimised
So what is the difference? Well apart from the fact that individual customers are multiplied to become society and the environmental wastes have a slightly different character than the traditional lean wastes, not a lot.
What is necessary is to include a set of diagnostic mapping tools and implementation tools that addresses the wider Planet issues and the Voice of Society. In other words, an extra Environmental pillar has been added to the traditional Lean House.
For further information about this blog series or the accompanying webinar series please contact Dr Donna Samuel, donna.samuel@sapartners.uk the series manager.
The failure of policymakers to make binding commitments at the Rio+20 Summit resulted, at best, in a lowest common denominator agreement that delivers few real benefits. In 2010, the UK Sustainable Development Commission (SDC) was axed as part of the government’s spending cuts. In the US, Republican efforts to defund the entire Environmental Protection Agency risk even deeper structural shifts.
International governments’ inaction and lack of leadership is clearly worrying but, at the same time, the proactive approaches of a few leading-edge companies are encouraging. Toyota, Sainsbury’s, WalMart, DuPont, Tesco, Unilever, Marks & Spencer and General Electric have made tackling environmental wastes a key economic driver. As Jonathon Porritt, director of Forum for the Future, observed, a “governance shift” is occurring in the field of sustainability, with governments stepping back and businesses stepping forward to lead the change.
DuPont, one of the early adopters, committed itself to a 65% reduction in greenhouse gas emissions in the 10 years prior to 2010. By 2007, DuPont was saving $2.2bn a year through energy efficiency, the same as its total declared profits that year. General Electric aims to reduce the energy intensity of its operations by 50% by 2015.
Unilever plans to double its revenue over the next 10 years while halving the environmental impact of its products. In 2010, WalMart announced that it will cut total carbon emissions by 20m metric tons by 2015. Closer to home, Sainsbury’s has announced its industry-leading “20×20 Sustainability Plan” which is the cornerstone of the company’s business strategy. It seems to be on track. In April this year, Sainsbury’s said it had achieved its target of a 50% relative reduction in water consumption.
Tesco has announced that it will reduce emissions from stores and distribution centres by half by 2020 and that it will become a zero-carbon enterprise altogether by 2050. Toyota, already in its fifth five-year Environmental Action Plan, announced that it will improve the average fuel efficiency of its vehicles by 25% in all regions by 2015 compared to that of 2005. In manufacturing, Toyota has already reduced emissions per vehicle by 47% between 2001 and 2012.
Companies such as Tesco and WalMart, are not committing to environmental goals out of the goodness of their hearts, and neither should they. The reason for their actions is a simple yet powerful realisation that the environmental and economic footprints are most often aligned. When M&S launched its “Plan A” sustainability programme in 2007, it was believed that it would cost more than £200m in the first five years. However, the initiative had generated £105m by 2011/12 according the company’s report.
When we prevent physical waste, increase energy efficiency or improve resource productivity, we save money, improve profitability and enhance competitiveness. In fact, there are often huge “quick win” opportunities, thanks to years of neglect.
Environmental waste is the best proxy for identifying and eliminating economic waste. That’s the secret of these companies.
As you may have read in my previous blogs, Lean is rapidly evolving. It is moving past the traditional tools and one off events stage. People are also challenging whether the original concepts we learned about in the last century are really right. One of the most serious mistakes that organisations make is to only look inside their four walls and not at the wider supply chain, both towards the customers and suppliers. As it happens this supply chain area is where my career started in industry before moving on to the University and consultancy world. My early research (captured in the book ‘Creating World Class Suppliers’) showed that the management of the supply chain may be the most important element in achieving competitive advantage.
I believe it is a more holistic or systems based approach is needed, balancing traditional hard methods within multiple processes as well as a range of enabling mechanisms within the strategy deployment, leadership and engagement areas of work. In other words the secret lies in thinking about Lean less in simple cost reduction terms and more as a way of thinking, behaving and improving, impacting on every aspect of work inside a business. I call this a Lean Business System.
So how do you go about developing this modern lean approach? Those of you that read my previous blogs will know that I believe the starting place is not copying some exemplar such as Toyota who almost certainly is in a different industry, faced with different circumstances and at a different stage of its evolution. What is needed is to start from a simple set of Lean Principles that can be applied to any industry and using this to guide your journey. Having learned from 25 years of application of lean I have defined 8 such principles: the 8Ps of the Lean Business System.
This framework helps companies in any industry, and at any stage of Lean maturity, to reflect on how they are deploying Lean in their business. It helps to take the focus away from point-kaizen activity towards a more contingent approach, a more aligned approach, a more human approach and ultimately, a more sustainable approach. Indeed it is part of a move to Lean becoming a cultural journey towards everyone in the organisation actively working towards a fully aligned ‘tomorrow better than today’ system.
No company or organisation is an island and to create a world class organisation usually requires the creation of a world class supply chain. Indeed, the leading practitioners of Lean worldwide such as Toyota and Tesco have also heavily focused on creating a high performing supply chain.
Indeed, when I compared the relative performance of Toyota’s Japanese supply chain with a comparative one in the UK I found that the management of the supply chain was Toyota’s key competitive advantage. As can be seen below, based on comparative productivity figures for the whole supply chain, the major competitive advantage did not lie at the car producer but more at the 1st and 2nd tier suppliers.
The Competitive Gap When Partnering
The question is, why? After three months of extensive research I discovered that the reason was that Toyota invested a huge amount of effort into partnering with their suppliers. In doing so they made dramatic improvements to their performance. Not only that, but Toyota had also taught their suppliers how to do the same using an approach they call Kyoryoku Kai or Supplier Association.
Unfortunately, although this inter-company development and coordination is at the heart of a true Lean Business System there are few companies in the West outside of the automotive industry that have got anywhere near achieving the type of results we see from Toyota in Japan. One of the main reasons is that insufficient focus has been given to the Partnering Principle in traditional Lean businesses.
For further information about this blog series or the accompanying webinar series please contact Dr Donna Samuel, donna.samuel@sapartners.com the series manager.
As you may have read in my previous blogs, Lean is rapidly evolving. It is moving past the traditional tools and one off events stage. People are also challenging whether the original concepts we learned about in the last century are really right. One of the most serious mistakes that many of us have made is an excessive focus on the ‘pull’ and ‘flow’ parts of lean without considering the risk, quality and reliability aspects of implementation. In other words many of us focused too much on Muda and not enough on Mura. Hence, I believe an important background principle we require is one of PREVENTION, or preventing quality issues from occurring. Arguably, if we had not forgotten about quality and the teachings of early pioneers such as Deming and Juran, the Six Sigma movement would never have happened as quality, quite rightly, would have been a central tenet of lean as it is with the most successful lean organisations.
For those of you not familiar with the series and the idea of the Principles behind the Lean Business System, I will just summarise for you:
I believe it is a more holistic or systems based approach balancing traditional hard methods within multiple processes as well as a range of enabling mechanisms within the strategy deployment, leadership and engagement areas of work. In other words the secret lies in thinking about Lean less in simple cost reduction terms and more as a way of thinking, behaving and improving, impacting on every aspect of work inside a business. I call this a Lean Business System.
So how do you go about developing this modern lean approach? Those of you that read my previous blogs will know that I believe the starting place is not copying some exemplar such as Toyota who almost certainly is in a different industry, faced with different circumstances and at a different stage of its evolution. What is needed is to start from a simple set of Lean Principles that can be applied to any industry and using this to guide your journey. Having learned from 25 years of application of lean I have defined 8 such principles: the 8Ps of the Lean Business System.
This framework helps companies in any industry, and at any stage of Lean maturity, to reflect on how they are deploying Lean in their business. It helps to take the focus away from point-kaizen activity towards a more contingent approach, a more aligned approach, a more human approach and ultimately, a more sustainable approach. Indeed it is part of a move to Lean becoming a cultural journey towards everyone in the organisation actively working towards a fully aligned ‘tomorrow better than today’ system.
One of the most serious errors I see in the use of Lean in general, is an excessive focus on tools and techniques. Not only this, but in many cases this focus is highly skewed towards a few tools. Among the ones I most frequently encounter are:
Big Picture Mapping (as popularised by Rother & Shook[1] under the term Value Stream Mapping)
5S
Kanban &
Quick Changeovers (SMED)
These are all good tools. However, they are often applied in a slavish, A before B before C, approach. Worse still, little allowance is made to whether they are the right tools or other more appropriate tools are required.
The most serious omission is usually tools within the PREVENTION area, or those described below in the Standardised and Stable Process platform and Quality pillar. These tools are focused on preventing variation, problems and subsequent rework or quality failures for the customer.
The result is that organisations are trying to improve the flow of an unstable system. This is very unlikely to work on its own. This failure within the traditional Lean approach (as applied by many) has led more enlightened organisations to try to fill the gap by collecting a series of tools to address the problem, firms such as Motorola and General Electric. However, for many firms that have gone down the Six Sigma route they have perhaps over-focused on the quality side and under-developed the delivery pillar as shown above (as well as many of the more people related issues we covered in earlier webinars). Hence, there became an imbalance with an over focus on the Quality pillar side of the true Lean Business System.
What is required is a balance of tools from the above Tool House of Lean. This balance should be pulled by the needs for local improvement where there is a “daily habit” of continuous improvement that uses simple, visual technologies, tools and techniques that have been chosen and adapted for effective use. Hence, the specific tools to be used should be contingently selected according to specific needs.
For further information about this blog series or the accompanying webinar series please contact Dr Donna Samuel, donna.samuel@sapartners.com the series manager.
[1] Mike Rother & John Shook, Learning to See, The Lean Enterprise Institute, Brookline, 1998
It’s not uncommon for managers to avoid difficult conversations with their people. But we all know that a failure to address issues clearly and directly can risk the continuation of potentially damaging behaviour.
Obvious examples are persistent lateness at work or a failure to follow health and safety procedures.
Another example is the sustained effort required for continuous improvement. In this context, there’s a need to reduce variation in process performance to create stable and repeatable processes that guarantee high quality product and/or service delivery.
Achieving this stage will have been a journey hard won in time and cash. The application of lean tools will signify the arrival of standardisation, a prerequisite for continuous improvement. But what happens if people don’t adhere to the processes they’ve been trained to follow?
Our research shows that managers have two broad strategies for dealing with failure to adhere. The first is to ignore it, either completely or they wait for a good time to raise it; the second is to go in hard and punish. These strategies reflect deep-seated underlying preferences for managing conflict. The first allows (often tacitly) for non-compliant behaviour to continue, undermining weeks of solid investment in trying to create new ways of working; the second heightens resentment, diminishes relationships and ultimately affects performance.
In fact, what managers need to do well is admonish. Admonish – an old-fashioned word, more frequently found in the novels of Charles Dickens – means to re-establish boundaries or to correct. This is done calmly, factually, clearly and with an understanding of the offending individual’s limitations.
There is no punishment in admonishment (“Fail to do that again and I’ll have your…”); there is no delay (“I need to talk to you about something, are you free tomorrow?”); and, in particular, there is no sarcasm (“Good grief Tony, you actually managed to get one right!”).
When we admonish, we keep it simple, we deal with the issue immediately and we encourage the individual to take ownership of the need for adherence. Done well, this style of dialogue takes just a few minutes, deepens respect in the workplace and is learnable inside an hour. Taking it from a technique to a work of art takes practice, increased tolerance and often a little courage, but the results are significant in terms of hard benefit and employee engagement.
In his recent blog post, Jack Welch nails it. Jack points out that the journey to success, that probably got you into a leadership position in the first instance, is all about you. Being a successful leader once there, however, is all about coaching others in a team. There are many definitions of coaching. These two are simply my favourites:
Unlocking a person’s potential to maximize their own performance. It is helping them to learn rather than teaching them
(Whitmore 2003)
The art of facilitating the performance, learning and development of another
(Downey, 2003)
For a lovely little language-free animation of how coaching works, click here:
It is one thing to understand what coaching is and how it works and quite another to become an effective coach. Coaching is a craft that most of us will have to learn. In fact we will probably have to do some unlearning first. The demands of coaching often challenge our most fundamental and deeply embedded behaviours. At S A Partners we have found an effective mechanism for addressing those demands is through a deep understanding of language – our prevailing language preferences and associated behaviours. We are carrying out some exciting and ground breaking research on the language of leadership. To see and read more, click below to a webinar transmitted earlier this year and a white paper summarising the webinar:
During the early summer of 2013 I conducted a survey of my 80,000 LinkedIn group members[1]as well as other similar LinkedIn groups. Within the sample, 23% described themselves as beginners, 46% as intermediate and 31% as advanced in their lean journeys.
This corresponded well with how long they had been applying lean in their organisation: 15% not yet started, 22% in their first year, 33% in their second or third year and 30% in their fourth year or further.
The two purposes of the survey were:
To establish what issues or problems people have with their lean implementation activity and specifically what their single biggest problem was.
What can we learn from this that might help make future lean improvements more effective.
Professor Peter Hines’s Business model drives us to think of Lean differently. I have been around Lean for the past 20 years. It started off as being map your business to death, implement 5s, have a go at Kanban, then try OEE, then if your still going do Total Productive Maintenance (TPM), the most enlightened of us graduated to supplier bashing demanding price reductions and vendor maintained inventory. We took a very crass journey across the horizontal axis of the business model -value stream mapping tool implementation and then supply chain price reductions.
Sustainable transformation is obviously much more holistic and planned in its approach. The Lean Business Model shows us that true transformation results from aligning our strategy, engaging our people, use systems and not tools to improve our business, utilise the extended enterprise both to customers and suppliers. Lean is a very simple concept- 5 principles based around engaging our people and applying common sense. It is though often confused with tools and used in isolation – use Lean to initiate a change management process in your business, turn your Lean programme into your continuous improvement programme and finally admit you are here to do work better and deliver more benefit to your employees and customers and then you’re onto a winner.
During difficult times within business, the general reaction can be one of consolidation and cost cutting. All too often this results in a self perpetuating cost cutting spiral which can be detrimental to the long-term future of the business.
“Unfortunately,we come across this behaviour pattern all too often,” John Quirke, director of S A Partners Ireland says. “Companies often focus upon cost and budget cuts in the first instance,which can constrain progress and de-motivate staff. As a result, performance falls further, sales suffer and the business shrinks.”
Lean thinking provides businesses with the tools and thinking to approach these challenges differently. It is a mistake to see lean as solely providing the tools to identify opportunities for cost savings. At the very core of lean thinking is a focus on business growth and how to understand and serve customers more effectively.
Through the thoughtful and contingent application of Professor Peter Hines’ Lean Business Model, businesses are not only realising additional capacity, eliminating wastes and inefficiencies through increased customer focus, they are also identifying ways of filling this capacity and achieving profitable growth. This 2X to 10X growth is based on the realisation of operational capacity and a focus on true customer value.
So how can lean thinking grow your business? Before we answer that, here are some questions for you to consider:
How many new products or services have you delivered to the market in the last two years?
Of this, how many will provide sustained growth for your business?
Who decides what new products or services you develop?
Are you measuring customer performance through service and delivery failures or value-add activity?
Who is responsible for business development with your key accounts and do they have whole business view of what they offer to the customer?
How do you link what your customers’ value with your overall development strategy for the business?
If customer value has been integrated into strategy development, how effectively is this understood by the people across your business?
S A Partners work with many companies across many sectors. According to Quirke, “The first thing a company needs to do is stabilise what they have across the entire business and not just operations. This starts with understanding customer value, and also understanding what is a valuable customer?”
Think about that for a minute – the core of any business should be delivering exceptional value to the right customer. Within this, businesses need to accept that not all customers are friends.
Remember, you are implementing lean thinking to increase your bottom line profitability and to growyour business. It is all too easy to create an unsustainable business ‘Frankenstein’ around the old saying ‘the customer is always right’. Yes, customers can be right and yes small customers can become big customers, but are we focusing our attention, and that of the business, on the right customers?
And this brings us back to the word ‘value’. Whatever we do in the business, it should offer value. However, how often do we find ourselves continually performing non-value added tasks? Or even worse, do you realise what the non-value added tasks are in your business?
By understanding all these non-value added activities, you can then plan to eradicate and mitigate them. Straight away you are increasing your capacity within the business while increasing profits. However, a philosophy of lean for growth quickly focuses the attention of the business on how to fill this capacity. This forces the business to ponder the questions at the beginning of this article and to develop a process for identifying, understanding and delivering additional customer value.
S A Partners coach businesses to enable their staff to discover hidden capacity and fill in with additional customer demand. It takes time and it is not easy. “If it’s easy then you’re not doing lean,” says Quirke. “Currently in Ireland, we have a unique opportunity to develop Irish businesses and position them for profitable growth.
“Enterprise Ireland through their enlightened lean business offer is supporting companies with significant funding and technical support to implement lean thinking and this programme is delivering tangible results for Ireland Inc.” Quirke adds: “In Ireland we have a unique passion for what we do and how we work together in business.We are innovative in the way we solve problems. We are good with people and social skills and develop good relationships with our customers both nationally and internationally – this is a solid foundation for successful lean programmes.”
Lean thinking is successfully driving profitability in many Irish companies today. If you have not looked into the funding available from Enterprise Ireland then your competitor is probably ahead of you in the queue. Lean thinking is about business growth, and right now in Ireland, we need lots of that. Remember: customers make jobs.
In the mid 1990s I was fortunate enough to spend some months as a guest of Toyota in Japan. What I was trying to understand was why they were outperforming other car makers in the US, Europe and Japan. My previous research had also led me to believe that part of the reason for this was their effective use of the supply chain and supplier development. Later I was to help Toyota apply a similar approach to their UK supply chain.
So what did I find?
Well, as part of my research I interviewed over 50 senior Toyota staff and got a very consistent answer, “the thorough and disciplined application of the Toyota Production System (TPS)”. The more I heard this answer and the more I observed in the Toyota factories and supply chain the less I began to believe in the ‘it’s all about TPS’ answer. So what was the ‘secret’? It appeared to me that there were 5 key areas that made Toyota work:
A rigorous focus on the purpose of the organisation that was effectively deployed to all parts of the organisation
A detailed understanding of the needs of the customer that drove all of their key business processes
An effective alignment and engagement of their people through an insightful leadership process
A set of standardised and widely applied tools and techniques
The spread of these first four areas to their wider supply chain, primarily through the Suppler Association process
These five elements I collated and termed it a Lean Business Model. What I realised was the TPS as described to me with its focus on the two pillars of heijunka and jidoka was only a part of the story, one covered within the 4th element of tools and techniques. In fact, more important it would seem, were the first three, which I could summarise as an effective focus on Purpose, Process and People. If pushed, of these probably the most important is People.
However, when I reflect on what most organisations go about implementing lean, it is still seen by many as a set of tools implemented in a series of disconnected improvement events without much attention to the business purpose, wider organisational processes nor the people involved. Surprise, surprise the result is poor engagement and sustainability!!
This is why we have started to collate our thoughts and many of you will already have taken part in discussion in our various Lean Business System LinkedIn groups. What this thinking, these groups and indeed this web site are trying to do is elevate us all above mere short term fleeting quick wins to using, adapting and rigorously deploying in a disciplined way the 5 key elements of the Lean Business Model. I don’t mean a mere copy of Toyota but an appropriate adaptation to a system of thinking, a system of work and a system of improvement that will work at all levels of our own organisation. That is what the Lean Business System approach is about. You might find it helpful to read more about how to create a Lean Business System or the principles behind it.
Reflecting now many years later I realise that the key words the Toyota staff were saying were not ‘Toyota Production System’ but ‘thorough and disciplined’. However, at the time neither they nor I knew this. Toyota themselves have now recognised this fact and have now rebranded TPS as a Thinking People System.
Peter, Professor Peter Hines
Chairman, S A Partners
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leadership and engagement areas of work. In other words thesecret lies in thinking about Lean less in simple cost reduction terms and more as a way of thinking, behaving and improving, impacting on every aspect of work inside a business. I call this a Lean Business System.
To start creating the Lean Business System [1] it is necessary to follow the steps described above for each element of the Lean Business Model®. It is not just about taking each element a bit further in each Roadmap, but about making discriminating choices of what to do at what point in time. Indeed, the more difficult choice is what not to do in the first Roadmap, as trying to do everything at once will lead to delays, frustration and poor sustainability.
