Tag Archives: Toyota

Quality of Work Life and the Toyota System

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WebImage1Books on lean management and the Toyota Production System are too often presented as if this system has been a virtual heaven of production efficiency and worker satisfaction. In the author’s enthusiasm, questions about stress and work life are rarely raised or they are glossed over. In Japan there have been serious issues raised about the quality of work life at Toyota plants and Toyota has openly addressed this issue itself, along with its union, and conducted its own whole-system redesign to improve the attractiveness and reduce the stresses of working within their system.

For the past month I have been sitting here, very focused, on completing another book (yes, one more!) on transformational change management, or whole-system architecture. Lean is a description of a desired state. Within lean is an incremental change process – continuous improvement. But, it is not a process of significant or transformational change. It is the “Where are we going?’ but not, the “How do we get there?” Many companies fail in their adoption of lean because they do not address the “whole-system” and misaligned structure, information systems, HR policies and other cultural drivers inhibit the transformation to lean. Whole-system architecture is a way of addressing the needed transformational change.

The good thing about book writing (you should try it!) is that it forces you to think, to research, and to organize your thoughts. While doing my research I came across what I think is a very interesting article on how Toyota addressed significant quality of work life issues. For those of you who are serious students of lean you may wish to go to the source and read the entire article.

Quality of Work Life and the Toyota System

In the 1990′s Toyota faced its own labor crisis with a 25% rate of turnover among new recruits to the workforce, an aging labor force, and a general aversion among young Japanese to working in factories. This raised serious questions within Toyota about their own system and how it impacted the quality of work life. The following paragraphs are quotes from an important study of what Toyota did in response to this crisis, a study that has been overlooked by most proponents of lean manufacturing.

“Facing up to the labour shortage and to the exhaustion of the whole work force, the management and the union at Toyota began to question the production system and the method of managing work. They concluded that a radical resolution of the crisis of work could only be found in a reorganization of the production system to make work more attractive, for they were in agreement that the cause of the labour shortage was the nature of assembly line work and the Toyotaist method of managing work.”

“The management of efficiency lay in the reduction of the number of workers, which was accomplished by Kaizen activities on production tasks and procedures. This in turn was based upon the ideas of ‘just-in-time’ and ‘autonomization’ (labour saving) which had been sustained and developed by T. Ohno. But the underlying cause of the crisis of work that Toyota was experiencing was precisely this system for managing productive efficiency. Therefore the idea of ‘just-in-time’ was questioned. ‘Just-in-time should not be applied to people’, according to a section leader at the Motomachi factory. ‘If the number of production workers is increased, productive efficiency will be lowered. But we should not think solely about productive efficiency’, according to the personnel management department. The implication is that the reduction in the number of production workers should not be pushed too far. In other words, ‘lean production’ should not be applied to production workers. Otherwise, work will continue to be detested by the younger generation and will continue to tire production workers and supervisors. Hence the committee proposed to modify the management of costs.”

“This questioning of the production system has finished by modifying the idea of ‘just-in-time’ and the management of productive efficiency: ‘just-in-time should not be applied to people’, and ‘we should not think solely about productive efficiency’. Hence a humanization of the production system and of work was launched. By investing massively to improve working conditions, by developing a new conception of the production line, by allowing segments of the line to keep buffer stocks, by making social relations of work more equitable and rational, Toyota has changed the rules of the game. For Toyota, ‘lean production’ appears to be the model of the past, because it placed too much pressure on people. The new strategy at Toyota is to give a more humane dimension to its production system but without hindering productivity; even if progress remains slow, and is held back by the old Toyotaism.”

“In terms of team work, four production workers form a work team which is responsible for a segment composed of a series of connected tasks (three or four tasks). The work team takes responsibility for the quality of its tasks, whereas on traditional lines, each person is responsible individually.” [1]

The Imperative to Redesign… Periodically

Thomas Jefferson is reported to have said that “Revolutions in human affairs, like storms in the natural environment are, from time to time, a necessary and desirable thing.” He is also reported to have suggested every twenty years. The point is that every now and then we need to rethink our system of organization – the social, technical and economic system – or the “whole-system architecture” in order to assure that we are adapting to change in the internal and external environment. This is exactly what Toyota has done.

The lesson of Toyota’s experience at its own plants is that the lean system of production is not simply a technical, mechanical, system in which the only goal is to improve production efficiency by eliminating waste; although, that will always be one of the goals. It is also necessary to design a system that takes into account the human factor, the social system that enriches the work and the quality of work life.

The other lesson from the above study is that the Toyota Production System, or lean, is an “open-system” able, no required, to adapt to the environment in which it lives. Like every organic system, it either adapts or dies.

[1] “Humanization of the production system and work at Toyota Motor Co and Toyota Motor Kyushu.” By Koichi Shimizu, In Enriching Production: Perspectives on Volvo’s Uddevalla Plant as an Alternative to lean production. Sandberg, Ake, Editor, Digital Edition, Stockholm. 2007. P. 398.

 

Meta-Lean: The Unity Principle

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When the Western mind encountered lean organizations such as Honda and Toyota, we overlaid our ways of thinking, the mechanics of our mind, onto those systems and reduced them to their component parts. It is the tendency of the Western mind to employ reductionism to explain the workings of systems. But, that is not the way of the Eastern mind.

Lean Metaphysics

Some companies have engaged in what they think are lean implementations by reducing lean to component parts and experimenting with one component over there, another over here, and a third somewhere else. That is guaranteed to fail. The very idea of reducing lean to its component parts fails to “get it.”

There are components to lean: just-in-time, continuous flow, quality detection systems, plant design, teams, information sharing, etc. But, there is also something that holds them together, something that is almost metaphysical, which I will all “Meta-Lean.” It is a Zen, a philosophy, a working of the mind that is distinctly different than the workings of the mind in traditional Western organizations. Meta-lean principles hold the parts together and enable them to work together in a dynamic that leads to self-correction and improvement.

I believe that the first principle of meta-lean is what I called in a previous book, The Unity Principle. Honda took this principle to heart and sought to apply it in their U.S. operations. It is simple, yet profound. Let me give an example:

The human body is a natural system. It is organic, living, changing, adapting, and composed of interdependent parts or sub-systems. It is a “whole-system.” It can be reduced to component parts. There is the digestive system – the mouth, throat, stomach, etc. There is the respiratory system;  the cardiovascular system; and, of course there is our natural IT/IS system, our brain and central nervous system. You can describe each of these systems independently. You can remove them from the body and dissect them. But, they will be dead. Their life depends on their interdependence. The whole is greater than its parts.

The reductionist mind would view the human body as merely the sum of each of its subsystems. Yet, each of these subsystems contains no life unless completely integrated with the others. Only when the body is whole can we say that it is a human life. It is more than the sum of its parts. I think any scientist would agree that even after more than a thousand years of dissection and study of the human body, we truly do not understand the magic of its connections, its unity as a whole, which gives it intelligent life.

I will argue that lean culture, lean organizations, contain a similar mystery of life. Separate the parts and it becomes lifeless, unify the parts and a magical thing happens. It gains life as the parts interact and support one another.

The Unity of Social and Technical Systems

When I was last in Marysville, Ohio at the Honda assembly plant I also visited a supplier, Stanley, that produces headlight and taillight assemblies. The Stanley plant has no outgoing warehouse or storage area. Pallets of assembled headlights or taillights go directly onto a truck. That truck moves every two hours to the Marysville plant. The “pile” of headlights and taillights at Marysville is merely a two-hour pile. The truck must move every two hours. That, of course, is the just-in-time work flow. However, that is only subsystem of the whole organic system.

Associates on the line have a phone at their work station. When they find one… I repeat… ONE bad part, they pick up the phone that rings in quality assurance. A quality assurance associated immediately answers the phone. He then comes out and picks up the part. He returns to his desk and picks up a second phone. That phone rings at the supplier. The suppliers is informed of the defective part and the supplier must get back within one hour to explain what he is doing to correct the defect that was created only hours ago. Remember the two hour pile!

Notice that this human feedback loop involved only first level hourly associates. No manager got in the way to slow it down. No meetings were called. No studies made or reports written. The hourly associates were trusted to transfer information through the artificial walls of legal company boundaries that become irrelevant in a lean system.

The immediate feedback loop conducted entirely at the first level is employee empowerment, engagement, trust. Without this, the two hour just-in-time process becomes impossible. One system is entirely dependent on the other… just as in the human body.

Thinking that Unites and Thinking that Divides

In the culture of the Lakota Sioux the hoop, the circle, has sacred significance. Kevin Locke is a friend of mine and he is a well known “hoop dancer”. He told me that the Lakota Sioux, when they first encountered Europeans moving west, referred to them as Oblatongyangpi,  which means “people of the square” or just square people. Why? They carried things with four separate sides (books); when they built homes they built squares; they cut out squares to look through; if they had a lot of homes they organized them into squares; they even tried to do square dancing… almost impossible. Obviously, they loved squares with four separate sides. Each side can be measured separately and each side has a beginning and an end.

And, in the world of the Sioux, they built round homes, organized them into circles, danced in circles (much easier!) and the hoop, which has no beginning and no end, symbolizes the unity of all human beings, people and animals, earth and sky, in one organic whole created not by man, but by the Great Spirit. You may have heard the phrase “Indian giver”, someone who gives and then takes back. This misunderstanding comes from the fact that Native Americans had great difficulty understanding the idea that you “owned” a piece of property. How could something that was created millions of years ago and is eternal belong to someone who will last only an instant? The land will soon own you, not the other way around, and you will own nothing but your soul.

Westerners are obsessed with property lines, ownership, divisions between things. We employ armies of lawyers to argue over who owns what and where the lines of squares are drawn. Much of it is cultural insanity that adds no value but consumes energy.

We love to organize people into two separate categories. In the recent election campaigns we had the absurdity of the population being simplistically divided into “makers” and “takers”, “producers” and “mouchers.” It is an insane example of square thinking. Yesterday, I read that John Sununu, former Governor of New Hamphshire, weeks after the election was explaining the Obama victory by the dominance of takers over makers. The irony is that John Sununu has spent his entire career in the employ of government, taking from the people, never having started a private company or managed a productive enterprise in the private world. Yet, it is comfortable and an easy explanation to divide the population of the United States into those who take versus those who make. Nothing is so simple and the nonsense of these false divisions (and there are many) are destructive of the unity of the nation.

Divisive thinking tears apart the unity of the whole. Every genuinely great leader sought to unify people in common purpose. Every general of every victorious army understood that the army had to act in unison, marching together and claiming victory together. A divided army is easily defeated.

The sickness in many of our organizations is a sickness of division. We create compensation systems that separate and divide rather than unite. We create different forms of dress, offices, buildings and symbols that separate people into those who do labor and those who make decisions.

Lean culture and management requires the destruction of divisions. There is no division of thinkers/deciders and doers/order takers. Every associate is a thinker and every one a decision maker. Every member of the organization should be rewarded based on the success of the whole. Symbols such as the different dress codes or uniforms should be abolished because they inherently imply divisions of class.

The lean mind does not see divisions created by lawyers in the form of corporate walls. The flow of the work process must flow through the division of legal walls as if they do not exist. They are irrelevant to the end user of any product. Lean is like the stream flowing from the top of the mountain to the sea in one continuous motion. The flow of the stream is not interrupted by legal property boundaries and does not wait for management decision making.

Until the leaders of the organization have understood the power of unity over division and have meditated on the creation of unity within their organization and the unity of flow through all the walls and silos of departments or companies, you have not adopted lean culture or thinking.

The idea of the Unity Principle is simple. The idea of whole-systems is simple. Yet, putting these ideas into practice is not simple and requires dedicated effort.

 

 

 

 

The Practice of a Lean Management System: Achieving Economic Efficiency and Social Intimacy

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Many years ago one of the first books I read on management was Peter Drucker’s The Practice of Management. In it Drucker defined and extolled the virtues of the management profession and gave credit to Alfred Sloan the longtime CEO of General Motors for developing the model of professional management in much the same way we speak of Toyota today. The system that Alfred Sloan created at GM was built on the theory  of management as a distinct profession, separate from engineering and other specialties.

Womack’s View of Modern vs. Lean Management

Jim Womack’s (founder of LEI Institute) recent book, Gemba Walks, contains a number of interesting and helpful short essays. These are Womack’s more recent meditations on the implementation of lean management. One of the more interesting, in my view, is his essay on Modern Management vs. Lean Management in which he contrasts the system of management build by Sloan at GM and lean management as it was built at Toyota.

What then is the contrast between the “modern management” of Sloan and the lean management of Toyota/Honda? These are the contrasts that Womack describes:

This is a great list and you could literally write a book with a chapter on each of these contrasts. Let me make a few comments on these contrasts by putting them in the context of a matrix I have long used to describe the transformations of organization cultures from the family farm forward.

Modern management at General Motors created a social class system, a disunity or social strata, and that disunity was the ultimate cause of collapse, as it has been in every civilization.

Social Intimacy and Economic Efficiency: The Miracle of Lean

Those of you who have participated in one of my seminars have no doubt heard me discuss the idea of sociobiology, that there are not only physical, but behavioral characteristics that are genetically passed on because of their contribution to our survival. For most of human history, beginning on the Serengeti Plains of Africa where we hunted antelope in small tribal groups, human beings have worked in family units.  The family farm and the small craft shop structure are only the more recent examples of work systems where there was high social intimacy, high interdependence, and high trust.

This so-called modern management that Womack speaks of began at Ford with the specialization and separation of work and management, the separation of doing versus deciding, and the isolation of workers who were instructed to “do your own work.” This instilled fear and created the loss of the social intimacy that had become the “natural” work environment for the human species over the previous millions of years. The work system and organizations of both Ford and Sloan had become contrary to human nature. This led to the natural rebellion, the need for association, the need for “brothers” in the union as inner city youth seek the safety and security of their brothers and sisters in gangs. Seeking security in groups is healthy psychological survival behavior in the presence of isolation and fear.

The industrial revolution and the revolution in management and organization had created great gains in productivity, economic efficiency, but had destroyed the social intimacy necessary to well functioning human beings and well functioning social systems.

Each of Womack’s contrasts between “modern management” and lean can be seen in this light. Decisions being made remotely versus decisions on the spot is another way of describing the class system, the alienation of leader and led, top to bottom, which almost always results in rebellion from below. The same is true for “staffs improving the process versus teams and those close to the work” improving the process. Similarly, standardization by staff groups versus standardization by line managers and those doing the work is another symptom of the this vertically disengaged culture. Experiments by those doing the work, versus imposed plans from above is the same. Each of these contrasts described by Womack illustrate how lean management is solving the social and psychological alienation created by both Ford and Sloan.

Lean Could Follow Modern Management: Pride Precedeth the Fall

While I generally agree with Womack’s analysis he does leave out an important historical context. The system of production created by Henry Ford was a great advance over craft-shop production in economic efficiency. Resources were made more productive – capital, labor and materials. However, as that system conquered the world of manufacturing it led to the excess of specialization or fragmentation of work, the dis-empowerment of workers, inhuman working conditions, bullying supervision and the natural response of unionization as a counter force. Ford’s system, still extolled by Toyota, became barbaric.

Similarly, there was much initial good in the system of management created by Alfred Sloan. Ford’s system did not provide for the management of a large differentiated organization and the integration of diverse and complex functions. The General Motors system added this capability by creating accounting and control systems that enabled the design of a diverse range of cars, sharing many parts, and utilizing shared engineering and production facilities. GM developed a superior system of administration and this is why GM overtook Ford and became the leading manufacturer of automobiles. It wasn’t until Ford hired Robert McNamara and “the Wiz Kids” after World War II that Ford developed its own system of management.

General Motors not only developed a system of integrated organization, but they promoted and developed professional managers. An entire hierarchy and departments of professional managers emerged. Power and decision making shifted from the engineers to the professional managers, accountants and strategic planners. However, just as happened at Ford, excess pride in their system led to the assumption that all things could be solved by professional accounting and strategic planning systems. Unfortunately for GM, none of those systems of “modern management” as Womack calls them, could engineer a superior car or produce one with few defects. Both GM and Ford grew to place excess faith in their accounting and administrative systems and failed to focus on the core skills of engineering and manufacturing.

This historical context is important because each management theory or system has its day and makes its contribution. And then, their methods tend to become mechanical, bureaucratic, a set of standardized and unthinking procedures that blind their followers to new methods. And are there no signs of the same in lean implementation? Is 5S, standard work, and other methods becoming bureaucratized? Are lean practitioners a little too certain about what they think they know?

Pride and arrogance always precede the fall, whether in civilizations, companies or management methods. Lean practitioners beware!

The Miracle of the Lean Management System

The miracle of lean organizations is the achievement of both economic efficiency and social intimacy. This can truly be labeled “the high performing organization” because it not only serves the needs of customers but also the needs of the people within the organization. It achieves not only business performance, but it enables the realization of human potential. It is not only a technical system, but a social system.

The power of well functioning teams, at every level, is that they are the key to creating unity of social intimacy and economic efficiency. Teams are the family unit of modern organization. Having done some work at both Ford and General Motors I can tell you that the psychological isolation was not only symptomatic on the factory floor, but in senior management ranks as well. They were not safe environments. Isolation, whether a worker at one machine in the factory, or within the confining walls of an executive office, leads to fear and distrust. The elimination of walls and silos must be both horizontal, between departments, as well as between levels of management and employees. Disunity must be replaced by social unity.

At this same time I was involved at Honda in Marysville and the social unity between leaders and led was obvious and in stark contrast to the alienation at GM and Ford. The arrogance of “professional management” was gone and replaced by a deep respect for those who did the value adding work on-the-spot.

I am seeing lean implementations that address front line work processes, but fail to recognize the social illnesses that have been created over many years of fragmented organization, the dead carcass of so-called modern management. The principles of lean management that Womack articulates can heal that illness.

So What Happened to Toyota???

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With the rash of recalls, deadly accidents and a pending congressional investigation into Toyota’s quality problems an entire industry of consultants, book publishing, and training has been thrown into disarray.

Last week I was at a client and I was explaining some point of lean culture and I used an example from Toyota. The union president who was in attendance stood up and said “I’ll tell you one thing, you better not tell us to do anything because Toyota did it. Ten people in the past week have come up to me and told me that we aren’t doing anything because Toyota does it.” That about sums up the sentiment out there.

I was tempted to reply that my relationship had been with Honda anyway and I didn’t see why Toyota got so much credit, but I restrained myself… wisely, I think.

So the question is… has all the adoration, the pursuit of the Toyota Production System (TPS), aka “lean manufacturing”, “lean thinking” and anything else “lean” that might make a good book title, been a completely mistaken pursuit? Have we all been misled?

The short answer is an emphatic “no!”

Every automotive company, in fact every manufacturing company worth a darn, has adopted TPS to some degree and would benefit by adopting more. Honda freely acknowledges that they copied TPS and have developed their own adaptations and innovations, as have others. The essential elements of eliminating waste, reducing throughput times, creating a high involvement-high responsibility workforce, continuous flow assembly and continuous improvement, are indisputably effective.

What went wrong at Toyota has NOTHING to do with the factory floor operations. What went wrong was entirely a problem of senior management failing to respond in a timely and effective way. What happened to Toyota is what happens to virtually every great company.

At this risk of appearing to shamelessly promote my own book, in Barbarians to Bureaucrats, I described the parallel of great companies to the rise and fall of civilizations. In achieving greatness the leaders most often also achieve hubris, the arrogance of success and power. Humility is an essential element of learning and improvement and its antithesis, arrogance, is the assassin of success.

The problem with unpredictable acceleration has been in the lap of Toyota senior managers for years. They engaged in self-denial, halfhearted measures to fix the problem, and hoped it would go away. When executives become so certain of the success of their company they lose a healthy paranoia. Andy Grove was right: Only the paranoid survive.

I feel deeply sorry for the tens of thousands of Toyota workers and front line managers who everyday are working to make the best possible cars, continuously improving their product and process. They had nothing to do with this. It was a design problem and a leadership problem. I also feel sorry for any manufacturers who take glee in this and choose to dismiss all of the many valuable lessons that can and should be learned from Toyota, Honda, and other lean companies.