"Manage a Living System, Not a Ledger"
Manufacturing Engineering
December 2006, pp. 73-80
Johnson provides a totally different perspective on Lean and Accounting than Brewer and Kennedy's in the above article. Like other paradoxes in Lean (such as being more productive through One-Piece Flow), Johnson argues that Toyota looks at improving financial results in a totally different way than most companies do: "It's hard for Americans to understand that a business organization cannot improve its long-run financial results by working to improve its financial results. But the only way to ensure satisfactory and stable long-term financial results is to work on improving the system from which those results emerge."
Toyota relies less than other organizations on second-hand reports and data, and emphasizes continuous improvement and problem-solving instead. The work at Toyota has been carefully designed so that the current state of each process is clearly visible. The author calls this approach "Managing By Means". He compares Toyota to a Living System, and says that "satisfactory business results follow from nurturing the company's system—the "means"—not from manipulating and wrenching its processes to achieve predetermined financial results."
Trying to achieve short-term financial results only leads to employees building work-arounds that violate the necessary sound systems principles needed for true improvement and competitiveness.
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