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Toyota Lean Leadership and Hoshin Kanri

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Toyota Lean Leadership and Hoshin Kanri

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Toyota Lean Leadership and Hoshin Kanri

  1. 1. February, 2019
  2. 2. Part 1: Toyota History & Kaizen Part 2: Toyota Leadership Part 2: Hoshin Kanri 2 Part 1: Toyota History & Kaizen
  3. 3. 3 Part 0: I. Yoshino’s Timeline
  4. 4. ✭ Sakichi Toyoda invented a weaving machine. ‘24 Kiichiro Toyoda founded Toyota Motor Corporation. ✭‘37 Toyoda Auto Loom Machine 1920 ‘30 ‘40 ‘50 ‘60 ‘70 ‘80 ‘90 2000 ‘10 Toyoda Model AASakichi Toyoda Kiichiro Toyoda “Open the window and look outside. It’s a big world waiting for you.” (Sakichi Toyoda) 4
  5. 5. 5 TO YO DA ト ヨ ダ 10 strokes TO YO TA ト ヨ タ 8 strokes Why did they switch from TOYO-DA to TOYO-TA??? 2-1. Kaizen Mindset is Fundamental to Toyota Culture
  6. 6. 6 Cost-consciousness is deeply ingrained in the mind of employees ➣ “Selling price -Cost = Profit”, not “Cost + Profit = Selling price” ➣ The blank sides of used documents are made to serve as memo-pads/ Shortened pencils are jointed on both ends ……. These cost-saving measures have been practiced since the start of the company 2-1. Kaizen Mindset is Fundamental to Toyota Culture
  7. 7. “Being content with one’s current situation could be the first step towards corruption” (Eiji Toyoda) 2-2. Kaizen Mindset is Fundamental to Toyota Culture 7
  8. 8. ✭ Sakichi Toyoda invented a weaving machine. ‘24 Kiichiro Toyoda founded Toyota Motor Corporation. ✭ ‘37 PREVIOUS CONCEPT of “Inspection” 1920 ‘30 ‘40 ‘50 ‘60 ‘70 ‘80 ‘90 2000 ‘10 ✭ “TQC” was introduced companywide in Toyota ‘61 Stringent inspection can improve quality NEW CONCEPT of “Inspection” Good quality should be built in at each process Big change in concept !!! - Quality problems - Lack of training (workers) - Lack of managing ability (managers) - Lack of horizontal communication Issues observed 8
  9. 9. 9 3 Heroes in Feudal Times “Owari” “Mikawa” Nobunaga ODA (1534 – 1582) - Born a son of a local feudal lord in Owari - Straightforward, mighty force, ruthless Hideyoshi TOYOTOMI (1537 – 1598) - Born a son of a poor farmer in Owari - Strong ambition to rise in society - Self-confidence, witty talented tactics Ieyasu TOKUGAWA (1543 - 1616) - Born a son of a local feudal lord in Mikawa - Taken as hostage at the age of 8 (12 yrs) - “Perseverance”, “prudence2, “certainty” ◎ ❋ ◯ “◎,❋,◯” shows their birthplaces △ Toyota HQs 4-1. What Influenced Toyota’s Corporate Culture?
  10. 10. 10 If you don’t sing, Little Cuckoo, I’ll kill you. If you don’t sing, Little Cuckoo, I’ll make you sing. If you don’t sing, Little Cuckoo, I’ll wait till you sing. Famous metaphor of 3 samurai leaders 4-2. What Influenced Toyota’s Corporate Culture?
  11. 11. 11 Ieyasu’s precept, Mikawa climate, and Toyota’s corporate culture ◯ Ieyasu TOKUGAWA’s Precept: ➢ Life is like a long journey with a heavy burden. Don’t hurry. ➢ One who regards inconvenience as natural will never be discontented. When you want more than you have, remember the days when you were in need. ➢ Patience is the base of being safe forever. Regard anger as your enemy. ➢ If you only know what it is to conquer and don’t know what it is to be defeated, it will be harmful to you. ➢ Blame yourself, not others. Not being enough is better than being too much. Mikawa Climate: ➢ Mountainous with soil underproductive. ➢ A sense of “fellowship, diligence, perseverance and loyalty to lord” was developed. Steadiness Learn from failure Diligence Humbleness Patience 4-3. What Influenced Toyota’s Corporate Culture?
  12. 12. ✭ Sakichi Toyoda invented a weaving machine. ‘24 Kiichiro Toyoda founded Toyota Motor Corporation. ✭ ‘37 1920 ‘30 ‘40 ‘50 ‘60 ‘70 ‘80 ‘90 2000 ‘10 ✭ “TQC” was introduced in Toyota ‘63-’64 “Cross-functional Management” & companywide “Hoshin-Kanri” was introduced < Cross-functional Management > < Hoshin-Kanri > Corporate Philosophy Mid/Long-term Managerial Plan Top Management Annual Policy Division’s Annual Policy Department’s Annual Policy Implementation (Do) Evaluation (Check) Feedback(Action) (Plan) 4 Issues pointed out at internal audit in 1962 1. Poor understanding on “Hoshin” concept. 2. Insufficient Long-term Plan 3. Weak viewpoint “based on facts” 4. Incomplete Horizontal communication ‘61 12
  13. 13. Sakichi Toyoda invented a weaving machine. ‘24 Kiichiro Toyoda founded Toyota Motor Corporation. ‘37 1920 ‘30 ‘40 ‘50 ‘60 ‘70 ‘80 ‘90 2000 ‘10 ✭ “TQC” was introduced in Toyota ‘ 61 ‘63-’64 “Cross-functional Management” & companywide “Hoshin-Kanri” was introduced QC Circle Presentation “TQC” takes root across Toyota’s shop floor ‘64-’65 ✭ ✭ Good Results of “QC Circle Activity” 1) “Quality should be built in at each process” 2) Product quality improved. 3) Quality/Cost awareness prevails 4) Managers learned “how to manage” 5) Appreciation & understanding of “QC Circle” strengthened 13
  14. 14. ✭ Sakichi Toyoda invented a weaving machine. ‘24 Kiichiro Toyoda founded Toyota Motor Corporation. ✭ ‘37 1920 ‘30 ‘40 ‘50 ‘60 ‘70 ‘80 ‘90 2000 ‘10 ✭ “TQC” was introduced in Toyota ‘ 61 ‘63-’64 “Cross-functional Management” & “Hoshin-Kanri” was introduced companywide in Toyota “TQC” takes root across Toyota’s shop floor ‘64-’65 ✭ Toyota won the ”Deming Prize” ‘ 65 Action plans after “the Deming Prize” winning: 1) Implement TQC activity to parts suppliers & car dealers 2) Focus on CHECK & ACTION process 3) Closer coordination among each administrative system 14
  15. 15. ✭ Sakichi Toyoda invented a weaving machine. ‘24 Kiichiro Toyoda founded Toyota Motor Corporation. ✭ ‘37 1920 ‘30 ‘40 ‘50 ‘60 ‘70 ‘80 ‘90 2000 ‘10 ✭ “TQC” was introduced in Toyota ‘ 61 ‘63-’64 “Cross-functional Management” & “Hoshin-Kanri” was introduced companywide in Toyota Background of “Kanri-Noryoku Program (Kan-Pro)” “TQC” takes root across Toyota’s shop floor ‘64-’65 ✭ Toyota won the ”Deming Prize” ‘ 65 ‘79-’80 “Kanri-Noryoku Program” 1) In ‘70s, managers’ “management capabilities & TQC awareness” decreased 2) In 1978, Nemoto formed a task force to promote a 2-year program (⇒ “Kan-Pro”) 3) Managers made presentations to top management in A3 based Hoshin-Kanri 15
  16. 16. ✭ Sakichi Toyoda invented a weaving machine. ‘24 Kiichiro Toyoda founded Toyota Motor Corporation. ✭ ‘37 1920 ‘30 ‘40 ‘50 ‘60 ‘70 ‘80 ‘90 2000 ‘10 ✭ “TQC” was introduced in Toyota ‘ 61 ‘63-’64 “Cross-functional Management” & “Hoshin-Kanri” was introduced companywide in Toyota “TQC” takes root across Toyota’s shop floor ‘64-’65 ✭ Toyota won the ”Deming Prize” ‘ 65 79-’80 “Kanri-Noryoku Program” ✭ NUMMI (J/V) Production started < Toyota’s plants in the US > ‘ 84 16
  17. 17. We were young ! Now we are old……. IY JS 17 1st group of Japan Training (6.1984)
  18. 18. ➢ “On-the-job” Training to NUMMI employees ◈ 600 group/team leaders sent to Toyota for “on-the-job” training. ◈ Training Program: Class (1w), Actual training at plant (2w). ◈ Comments from NUMMI trainees: ▶ “We didn’t practice KAIZEN at GM, but WE DO IT EVERY DAY HERE At TOYOTA” ▶ “When a defect is found on site, we PULL A STRING TO STOP THE PRODUCTION LINE to fix it. It’s amazing that WE CAN CORRECT THE TROUBLE on the spot. ▶ “Toyota managers FREQUENTLY COME TO SHOP FLOOR.” ▶ “People are TREATED GOOD at Toyota. Now I realize WHAT ‘RESPECT’ MEANS.” ➢ Changes that happened to NUMMI employees ◈ AWOL: improved to 2%. Assembly cost: almost equal to Japanese plant average. Productivity: 2 times better than GM average. Quality: top level in overall GM ◈ Employees became responsible for their work and proud of what they do. 11. Changes That Happened to NUMMI Employees 18
  19. 19. ✭ Sakichi Toyoda invented a weaving machine. ‘24 Kiichiro Toyoda founded Toyota Motor Corporation. ✭ ‘37 1920 ‘30 ‘40 ‘50 ‘60 ‘70 ‘80 ‘90 2000 ‘10 ✭ “TQC” was introduced in Toyota ‘ 61 ‘63-’64 “Cross-functional Management” & “Hoshin-Kanri” was introduced companywide in Toyota Need for “TQC” to evolve into “TQM” “TQC” takes root across Toyota’s shop floor ‘64-’65 ✭ Toyota won the ”Deming Prize” ‘ 65 79-’80 “Kanri-Noryoku Program” ✭ NUMMI (J/V) Production started ‘ 84 ‘’95 - “TQC” evolves into “TQM” 1) In 20 years after ‘65 Deming Prize, enthusiasm for TQC is decreasing. 2) In 1995, Toyota has more employees in overseas. Sharing the same “TQC Concept” is crucial. 3) Toyota strengthens its focus on “people”, Customer first TQM Continuous Kaizen Total participation < QC-based Perspective > Improving the vitality of Individuals & organizations 19
  20. 20. ✭ Sakichi Toyoda invented a weaving machine. ‘24 Kiichiro Toyoda founded Toyota Motor Corporation. ✭ ‘37 1920 ‘30 ‘40 ‘50 ‘60 ‘70 ‘80 ‘90 2000 ‘10 ✭ “TQC” was introduced in Toyota ‘ 61 ‘63-’64 “Cross-functional Management” & “Hoshin-Kanri” was introduced companywide in Toyota “TQC” takes root across Toyota’s shop floor ‘64-’65 ✭ Toyota won the ”Deming Prize” ‘ 65 79-’80 “Kanri-Noryoku Program” ✭ NUMMI (J/V) Production started ‘ 84 ‘’95 - “TQC” evolves into “TQM” Toyota Way 2001 “Toyota Way” (basic principles & behaviors) 20
  21. 21. Part 1: Toyota History & Kaizen Part 2: Toyota Leadership Part 3: Hoshin Kanri 21 Part 2: Toyota Leadership
  22. 22. ➣ Subordinates tend to report only what their boss wants to hear. ➣ “Bad news” is a great tool to find the root cause of the problems. ➣ A good boss will find out WHAT to blame, not WHO to blame. 1. Bad News First 22
  23. 23. ➣ In many companies, bosses often say, “Don’t bring me problems. I want answers.” People just bury them and move on with problems left unsolved. ➣ At Toyota, managers say, “No problem is problem.” They know there will be problems. It is managers’ job to see problems. Managers create an environment where people are encouraged to surface problems. 23 2. “No problem” is a Problem
  24. 24. ➢ People tend to bring reports that their boss wants to hear ➣ Go to the Gemba & see things with your own eyes ➣ Use your 6th sense to figure out what is happening there vs. 3. Go To Gemba Yourself 24 Judge things at his desk Judge things at the Gemba
  25. 25. Seemingly impossible target: ➣ “10% cost reduction” could be attained by the traditional approach. ➣ “50% cost reduction” requires drastic measures. ➣ It helps to develop a totally new idea. Seemingly impossible target Unconventional idea Target ① Max speed:250km/h Target ① Max speed:250km/h Shinkansen (Bullet Train) Project Target ② Tokyo - Osaka in 3 hours Target ② Tokyo - Osaka in 3 hours Target ③ Development period: 5 years (1959 - 1964 ) At first, these targets seemed impossible!!! “The impossible” was made “possible”! 4. Establish A “Seemingly Impossible” Target 25
  26. 26. ➣ Assign your subordinates core items (objective, target date, etc.) ➣ Don’t issue too detailed instructions. ➣ Encourage subordinates to think how to accomplish the task ➣ Stop to listen and discuss when they come for help. ➣ Check the progress at the right time and give necessary advice/help Don’t instruct everything from A to Z Don’t advise your subordinates to do what you have tried and succeeded. Show your subordinates that you are always ready to help when needed 5. Develop People To Attain A Target 26
  27. 27. “Failure is the mother of success.” ➣ “The spirit of challenge” is as important as the result itself at Toyota. ➣ “The spirit of challenge and effort” eventually becomes “know-how”. ➣ You can learn valuable lessons from failure. Always encourage subordinates to challenge. ➣ At Toyota, an employee is honored by the number of challenges s/he takes on. 6. Never Be Afraid of Failure “I challenged and failed the Water-ski Boat Project…...” I.Y. 27
  28. 28. ➣ Purpose of Mieru-ka (visualization) is to “reveal the root of the problem” - by making the invisible visible - by making things easy-to-understand to everybody. ➢ Benefit of visualization is to “vitalize the worksite” - by helping people to detect problems early and take actions early - by enhancing improvement awareness among members 28 7. Purpose/Benefit of Mieru-ka (Visualization)
  29. 29. ➣Maryann Keller, a former auto analyst, notes that, historically, GM hasn’t invested in root-cause analysis. (…) American car companies, she says, have tolerated high warranty claims based, in part, on an attitude that “if something happens along the way, so be it. It’s not my job.” (Harvard Business Review, Aug.2014) 29 8. Root out the problem instead of fixing superficially
  30. 30. ➣ Major purpose of A3 document is to help people clearly understand and share the current situation at a glance. ➣ Key points to create an effective A3: - determine the purpose of A3 (problem solving? status report? proposal?) - check how familiar the person you report to is with the topic - visualize your A3 (use graph/chart and illustration, compact/simple expression) - ensure the facts in A3 are all based on “Genchi-Genbutsu-Shugi” approach 30 9. A3 document (Hoshin Kanri, Problem Solving, New Proposals)
  31. 31. ➣ “If the worker hasn’t learned, the teacher hasn’t taught.” ➣ Finding strong points in your subordinates is more important than finding their flaws. ➣ Bosses who nurture excellent subordinates are more highly valued at Toyota. 31 VS. 10. A Good boss develops subordinates, while a bad boss hinders them
  32. 32. Part 1: Toyota History & Kaizen Part 2: Toyota Leadership Part 3: Hoshin Kanri 32 Part 3: Hoshin Kanri
  33. 33. ➢ “Hoshin” = “compass needle” or “direction”. “Kanri” = “management” or “control”. ➢ “Hoshin-Kanri” : • Planning & checking process developed in Japan in the 60s. • Basic concept came from the US techniques of MBO (Management by Objectives) and the Deming Plan-Do- Check-Action cycle. • Major difference is that “Managers’ targets are aligned with the corporate goals in Hoshin Kanri”, while individual initiatives are the focus of MBO 33
  34. 34. ▶ Identify key business issues facing the organization ▶ Develop measurable goals that address these issues ▶ Create action plans to pursue the goals ▶ Implement action plans at every business process ▶ Measure/Check the result (at mid-term & year-end) ▶ Feed-forward the analysis to next year’s plan P D C A 2. Key Structure of “Hoshin-Kanri” 34
  35. 35. Mid/Long-term Managerial Plan Top Management Hoshin for the year Division’s Hoshin for the year Department’s Hoshin for the year Section’s Hoshin for the year Implementation (Do) Corporate Philosophy Evaluation (Check) Hoshin Revision (Action) + + Feedback(Action) (mid-term & year-end) (Plan) 35
  36. 36. 4. Example Of Hoshin Format Used At Toyota 36
  37. 37. ① Employee Involvement ▶ All employees participate from the top down and from the bottom up. ② Focus on “The Biggest Issue” ▶ If you run after two hares, you will catch neither. Prioritize action plans. ③ Set “Clear Target” and “Expectation” ▶ Numerical target or concrete milestone should be established and shared with all involved. NumberofDefect Cumulative% Auto Part Defects Factor A Factor B Factor C Factor D 37
  38. 38. ④ Process-oriented ▸ Process to attain your goals is as important as its result. Result-oriented Process-oriented Plan - Set a target to producer a result - Select a process to achieve the target Do - Take actions and measure the result - Learn all steps of the process - Take actions according to the process Check - Check if the result matches the target - Measure process performance - Assess the cause of the defect in process Action - Take actions to the result that failed to attain the target -Take actions to the process that failed & succeeded to bring in good result 38
  39. 39. ⑥ “Regular Review” on the result & process ▶ Periodic review helps you to take quick actions. ⑦ People development ▶ Hoshin-Kanri helps to clarify people’s own goals and strengthens a sense of ownership < Maslow’s Hierarchy of needs > ⑤ “Facts” vs. “Assumption” ▶ “Facts” are “facts”. ▸ Genchi-Genbutsu-Shugi (Gemba-oriented) ▸ Data/Information-oriented attitude ▸ 5W1H (when, Where, Who, What, Why, How) ▸ Mieru-ka (visualization) ▸ 5S - prioritize & sort the information ▸ Bad news first! 39
  40. 40. ✭‘24 ✭‘37 1920 ‘30 ‘40 ‘50 ‘60 ‘70 ‘80 ‘90 2000 ‘10 ✭‘ 61 ‘63-’64 “Cross-functional Management” & “Hoshin-Kanri” was introduced companywide in Toyota ‘64-’65 ✭ ‘ 65 ‘79-’80 “Kanri-Noryoku Program” implemented Purpose: nurture Management Capabilities of Managers: ► Capabilities to be acquired: Planning& judging capability, Broad knowledge, experience & perspectives, driving force to get job done, leadership, kaizen capability, presentation ability (in A3-based on Hoshin-Kanri), persuasion & negotiation capability ► Reviews: Review sessions held 4 times in 2 years with top officers attending * Kanri-Noryoku Program 40
  41. 41. 1. All the managers in HQs area learned the importance of Hoshin-Kanri. 2. “A3 culture” prevailed across Toyota. People learned how to use A3 & to tell what is important from what is not. 3. Reinforced Toyota’s culture of not hesitating to report bad news. 4. Strengthened the management foundation and understanding of the role of managers. < “Kan-Pro” Review Session > 41
  42. 42. 2014 Version Toyota Kyushu’s Top Management Hoshin for 2014 • Aim at “A Role Model Plant for the World” through enhancing • Gemba Capabilities, Technical Capabilities and Humanity of each employee, and also through our globally-recognized car- manufacturing method Prioritized Implementation Items 1. Develop People: nurture self-sustained professionals with high aspirations and always ready to take on a challenge 2. Engage with local community: gain trust from the local people by fulfilling our role as a member of the community 3. Create good products: manufacture high-quality & low-cost made-in-Kyushu cars which can move the people around the world Department Hoshin on the next page 42
  43. 43. 43
  44. 44. 44 3.29.2017 Nagoya Gakuin University Isao Yoshino 1. IY’s Personal Vision for 2017 (Apr.2017 – Mar.2018) 1) Bring my students ’ English proficiency level to a higher level than that of last year . (⇚ Many students started enjoying studying English after 1-year practical sessions in 2016) 2) Build “a firm bridge” between NGU and the Universty of Memphis (U of M). (⇚ Same as last year. I would like to see more students visit each other, starting in 2017. ) 3) Explore new Lean Session opportunities in Eur ope, besides the US. (⇚ ① Success of “Japan Lean Tour”, ② Explore session opportunities in Europe; France, Spain, Netherlands and more ) 4) Maintain good physical & mental health. ( ⇚ watch what I eat & what time I go to bed & when I need to take a rest, Mor e patience and open-mindedness) 2. IY’s Personal “Hoshin” for 2017 (Apr.2017 – Mar.2018) Feedback from 2016 Target to attain for 2017 Key Hoshin for 2017 Detailed Action Plans for 2017 Timing (✳1) NGU: Nagoya Gakuin University ( ✳2) U of M: University of Memphis, Japanese Languag e Class (✳3) 9/’17 Spain, 11/’17 the Netherlands, 3/’18 France 2017 Hoshin Plan (Apr.2017 – Mar.2018) < IY’s Personal Hoshin Plan for 2017 (Apr.2017 – Mar.2018) > NGU ➣ Make my English classes more Intriguing & practical ➣ 70% of students get proactive and feel “it’s FUN to study English and learn other cultures” ➣ 90% of students know more about themselves and express their own opinions explicitly ➣ Focus on 2-way communication (more Q&A) ➣ Encourage students to “think deeper” and “ask questions” ➣ Use visual materials (You-tube, videos, movies, etc.) ➣ Students have great interest in foreign cultures/people (* 1) ➣ Conduct self-analyzing practices 4 times each semester ➣ All students will make a presentati on about themselves at the end of the semester ➣ Many students started enjoying studying English ➣ Help students understand other cultures ➣ invite English native spea kers (Ryugakusei) to the class regularly ➣ invite business people and talk about the “real world” ➣ Provide chances to analyze themselves and know their strength & weakness ➣ Students enjoyed analyzing & knowing themselves and are eager to explore more UofM ➣ Send 3 NGU students to U of M In early 2018 ➣ Strengthen relations with UofM (⇒ send NGU students to UofM) ➣ invite U of M students to NGU for 2-3 weeks In 2019 ➣ 3 NGU students will visit U of M to Japanese Language class in 2018 (as the 3rd -year trial) ➣ Develop a plan to get this new plan approved by 2/2018 ➣ Develop a strategy & time schedule (mid/2017) ➣ Meet related parties & obtain support ( for 5 months) ➣ Propose the plan to top management ( before end of ’17 term)(* 2) ➣ NGU students’ joining U of M class in 2/2017 was a success (becme “self-assertive” & proactive”) LEAN ➣ Tour date: 3/2018 (1 week) ➣ Participants:13-15 ➣ Preparations should be on schedule ➣ “2017 Japan Lean Tour” was postponed to 3/2018 (due to dis-organized preparations) ➣ Requests for Lean sessions newly came up from European countries (Spain, France, the Netherlands) ➣ Make “Japan Lean Tour” happen and become a success: 70% of participants say “target attained” ➣ Make European Lean Sessions for 2017 a success ⇒ 70% of session participants say “satisfied” ➣ Sessions: 9/’17, 11/’17, 3/’18 ➣ All the preparations should be finished as scheduled ➣ Strictly follow & apply the lessons learned from US project ► develop detailed time schedule and strictly follow it ► keep communication with Lean partners (skype once a month) (* 3) ➣ Comply with the lessons learned from the last failure ► re-develop a new Tour scheme and strictly follow it ► keep frequent communication with partners ► prepare an “exit plan” in the worst case ➣ Maintain good physical & mental health all the year around (no major sick-leave from work) Health ➣ I got sick 4 times in 2016 (due to less attention to my health condition & overwork) ➣ Keep me weigh less than 70kg ➣ Manage negative emotions ➣ Watch what I eat, (follow doctor ’s advice)s ➣ Watch how many km I walk daily (4km/day) ➣ Watch how long I work (leave office at 7pm) ➣ Be patient and open -minded to the things around m e at every class May & Oct.’17 every month Jul.& Dec.’17 Feb.’18 Jun.’17 Jul to Dec.’17 Dec.’17 or Jan.’18 Apr. – Oct.’17 Apr. – Oct.’17 check daily
  45. 45. Part 4: Q & A Time 45

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