“The Contradictions That Drive Toyota's Success”
Harvard Business Review
June 2008, pp. 96-104
The authors studied Toyota for six years and concluded that a good part of Toyota’s success is attributable to factors beyond the Toyota Production System. They state: “The company succeeds, we believe because it creates contradictions and paradoxes in many aspects of organizational life. Employees have to operate in a culture where they constantly grapple with challenges and problems and must come up with fresh ideas.”
The six major contradictory tendencies are:
- Toyota moves slowly, yet it takes big leaps
- Toyota grows steadily, yet it is a paranoid company
- Toyota's operations are efficient, but it uses employees' time in seemingly wasteful ways
- Toyota is frugal, but it splurges on key areas
- Toyota insists internal communications be simple, yet it builds complex social networks
- Toyota has a strict hierarchy, but it gives employees freedom to push back
Six forces were identified that cause these contradictions in the company. There are three forces of expansion that lead Toyota to instigate change and improvement:
- Impossible goals—These nearly-unattainable goals force senior executives to break free from business-as-usual and established routines. The goals also raise employees’ consciousness, identity, and self-worth.
- Local customization—Toyota “customizes both products and operations to the level of customer sophistication in each country”. Though this increases organizational complexity, it also unleashes employee creativity to develop new products, new technologies, new marketing methods and new supply chains.
- Experimentation—Toyota breaks down its big goals into manageable challenges. Then it experiments with new initiatives and processes to deal with the difficult aspects of each challenge. Toyota uses a continuous improvement process called the Toyota Business Practices (TBP) process. This provides a “path for the employees to challenge the status quo”. Employees are not punished for failure, and open communication about mistakes is encouraged.
There are also three forces of integration that perpetuate Toyota’s culture and stabilize the company’s expansion and transformation:
- Values from the founders—These values include kaizen (continuous improvement), respect for people and their capabilities, teamwork, humility, putting the customer first, and the importance of seeing things firsthand. The values are conveyed through on-the-job training and company stories.
- Up-and-in people management—Toyota is still committed to long-term employment. Underperformers are trained up, not asked to leave. Exemplary employees play the role of mentors. In evaluating managers, process performance and learning are considered more important than results. Persistence and resilience are also important managerial qualities.
- Open communication—This manifests itself as disseminating know-how laterally, giving people the freedom to voice contrary opinions, having frequent face-to-face interactions, making tacit knowledge explicit, and creating support mechanisms.
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“The Secrets To Successful Strategy Execution”
Harvard Business Review
June 2008, pp. 60-70
Through five years of research, the authors found that 3 of 5 employees rated their companies low on the ability to quickly translate important strategic and operational decisions into action.
The factors that most influence success in strategy implementation are related to clarifying who has decision rights in various situations and making sure that information flows where it needs to go. Re-structuring and attempting to ramp up motivation were significantly less successful strategies.
The top ten aspects that seem to be related to an organization being effective at implementing strategy are:
- Everyone has a good idea of the decisions and actions for which he is responsible.
- Important information about the competitive environment gets to headquarters quickly.
- Once made, decisions are rarely second-guessed.
- Information flows freely across organizational boundaries.
- Field and line employees usually have the information they need to understand the bottom-line impact of their day-to-day choices.
- Line managers have access to the metrics they need to measure the key drivers of their business.
- Managers up the line get involved in operating decisions.
- Conflicting messages are rarely send to the market.
- The individual performance appraisal process differentiates among high, adequate, and low performers.
- The ability to deliver on performance commitments strongly influences career advancement and compensation.
The article also provides a list of possible steps that an organization can take to try to improve their ability to execute strategy.
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“Standardized Work”
Manufacturing Engineering
May 2008, pp. 171-179
The author of this article defines standardized work as “a detailed, documented, and visual system by which workers develop and follow a series of predefined process steps.” These steps represent the current best way for workers to proceed in their tasks. Standardized work is considered a management system for the cell manager/leader who is responsible for the output and performance of a cell. Standardized work allows the cell leader to manage each of the following key components of the cell:
- The capacity of the cell—How much can the cell produce?
- The layout of the cell—Does the layout facilitate productivity with minimal waste?
- The material flow—Is product being produced one piece at a time?
- Work assignments—Who is doing what work?
- Staffing levels—Is there an appropriate number of people for maximum productivity?
The basic factors that must be in place before one can create effective standardized work are:
- The cell must be organized into a one-piece flow layout
- A repeating work sequence
- A willing cell leader
The key elements of standardized work are:
- Takt time—The pace of customer demand
- Work sequence—The work assigned to each person
- Standard WIP—The minimum number of in-process items needed for the work sequence to be carried out
There are six standard documents that help manage standardized work;
- Time Observation sheets
- Capacity sheet
- Standard Work sheet
- Loading Diagram
- Combination sheets
- Key Points sheets
Over-riding principles that should be understood and followed are:
- Observe the process closely
- Insist on a steady day's work
- Cell leaders are owners of the standardized work
- Insist on rapid problem-solving and corrective action
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“Room To Move”
Industrial Engineer
June 2008, pp. 47-51
This article defines a successful ergonomics initiative as “one that is effective (significantly reduces ergonomic-related injuries), efficient (gets the job done with reasonable use of resources), and sustainable (gains are lasting, not just one-time improvements).” A recent review of ergonomics “success stories” found that work-related musculoskeletal disorder injury rates and lost workdays were reduced by an average of 80 percent. Workers compensation costs were down by an average of 70 percent.
The three criticl areas where ergonomic can be most effectively deployed are:
- Integration with continuous improvement activities
- Ergonomic risk management
- Design for ergonomics
The author argues that ergonomics improvements can be naturally integrated into other continuous improvement activities. When employees are already looking for improvement activities, adding a perspective of recognizing ergonomic opportunities provides a whole new dimension. However, this opportunity has been largely overlooked by companies implementing Lean.
Some common ergonomic workstation improvements are:
- Raising or loweing work heights to allow work in neutral postures
- Improving parts storage to reduce reach distances, including moving parts, bins closer, lowering shelf heights, and providing additional storage within each reach
- Locating hand tools near the point of use
- Providing stands to present parts within easy reach
- Replacing heavy tools and fixtures with lighter-weight versions that have similar performance characteristics
- Providing positioning devices, such as hoists, portable lift carts, or even stationary stands, to support the weight of components as they are being machined or attached to a main assembly
- Providing alternative manual hand tools
The author discusses three phases in which ergonomics is important to the planning process:
- Identify challenges and alternative approaches at the concept stage.
- Review the proposed design to resolve "outages". Ergonomic checklists include items such as horizontal work reach, seated workstation dimensions, standing workstation dimensions, visual envelope, sitting exertion, standing exertion, arm/grip/hand strength, manual material handling, hand tool design, clearances and access, platforms/ladders/stairs, screens/controls/guages, and work environment.
- Institute a formal sign-off procedure that all user needs are being met.
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“Lean Manufacturing Principles and Their Application”
Cost Management
May/June 2008, pp. 16-27
This article presents a good overview of most of the key elements of Lean manufacturing. There is nothing “new” here, but it would be a solid article to hand out to someone to provide the big picture of the history and elements of Lean manufacturing. Topics covered include:
- The history of lean manufacturing
- Value steam mapping
- 5S
- Total Productive Maintenance
- Single Minute Exchange of Dies (SMED)
- Six Sigma
- Kaizen culture
- Hoshin Kanri planning
- Mistake proofing (poka yoke)
- Standardized work
- JIT
- Kanban
- Heijunka
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Five S; A Faithful Standby
As Kocakulah, Brown, and Thompson point out, Five S is a staple of lean implementations. At GPOE, we use the following translations of the Five Japanese words beginning with S:
- Sort: to remove and uneeded items from the workplace
- Simplify: a place for every needed item and every needed item in its place, ready for use
- Systematic Cleaning: everyone cleans
- Standardizing: to conduct the first three S's diligently and regularly
- Sustaining: to make Five S a way of life
You can see that the second S is very close in intent to Wynn’s ergonomic improvements and indeed considerations of where to place tools and materials often figures heavily in Five S workshops. Having the things necessary to do work close at hand improves work speed, Whitmore’s layout and flow and also safety (often used to extend the Five S’s to six).
But manufacturing work constitutes an ever-declining segment of the American economy and so an appropriate shift in focus for Five S is to ideas and information, rather than screwdrivers and job aids. Take a stroll through any American office and what is clearly in most need of Five S is not the physical items in the workplace (notwithstanding the paper piled on desks), but the email inboxes and action item backlogs of the average desk jockey. You can tell this because many workers seem to alternate between computer screens and meetings, or sometimes both at once, for the majority of their workdays. Studies show there are 77 billion corporate emails sent worldwide and the Radicati Group calculates they consume a fifth of our working days.
A number of schemes are available to sort, simplify, clean and standardize information flow and storage. These range from workgroup systems such as Microsoft’s SharePoint with its built-in document and action-item management to efficiency bibles such as David Allen’s Getting Things Done (Penguin, 2003). Allen recommends getting one’s backlog of obligations out of our heads and down into a simple, organized system where they can be managed using Five-S-like methods. And who can deny that an organization with less procrastination, clearer accountabilities and more things “done” will be more like Takeuchi, Osono, and Shimizu’s Toyota and more like Neilson, Martin, and Powers’ successful implementers.
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