Becoming lean john shook lean manufacturing

Toyota Production System
“Lean Manufacturing”

John Y. Shook. “Bringing the Toyota Production System to
the United States: A Personal Perspective”
Included as Chapter 2 of:
Becoming Lean: Inside Stories of U. S. Manufacturers
Jeffrey K. Liker, Editor
(Portland, OR: Productivity Press, 1998)

July 12 jpgillis@umd.umich.edu 1

Underlying Assumptions

 The concepts mass production and lean production reflect ways
of thinking about production – the assumptions that underlie
how people and institutions formulate solutions to the problems
of organizing people, equipment, material, and capital to create
and deliver products for customers.
 Mass and lean are paradigms that reflect and inform the
thinking about production within particular cultures and eras.

John Y. Shook. “Bringing the Toyota Production
System to the United States: A Personal Perspective”


Underlying Assumptions

 Lean manufacturing includes a set of techniques that
comprise a system that derives from a philosophy.
 The tremendous benefits promised by the lean paradigm can be
actualized only if we understand and implement accordingly.
 15 years after John Shook began his training in Japan, he was
still struggling alongside much of U. S. Industry to understand
what it was that he had been trained in and had also trained.



Lesson One: Learn by Doing

 Making a car: you stamp it, paint it, stuff it, and ship it. The
process is deceptively simple. (Jim Womack)
 Taiichi Ohno had a small and diverse market in Japan, and he
(and Nissan) had to meet all of that diversity, because the
government closed the market (for 25 years, with U.S. approval)
 Originally Toyota copied Detroit, but Ohno had none of the
economies of scale. In 1950 he was producing 1,000 vehicles a
month – what a Ford assembly line was producing in a day.



Lesson Two: Economies of Scale

 You can attain greater overall system efficiency through
concerted efforts to eliminate waste thoroughly (rather than
through economies of scale).
 You can survive and thrive in low growth.
 The system from the early 1970’s is little changed today. The
two most basic concepts are simple. One is to make what
customers want when they want it, nothing more and nothing
less. The other is to treat people with respect. This with
15,000 parts per car and 5,000 people producing a quality car a
minute.


The Two Pillars: Jidoka and Just-in-time

 Jidoka means – “autonomation” – built-in quality – the quality
principle – respect for humans system – automation with a
human touch (a coined term, even in Japan).
 Basically jidoka means building in quality and designing
operations and equipment so that people are not tied to
machines but are free to perform value-added work that is
appropriate for humans. (If people are stuck watching
machines, who is working for whom?)



The Two Pillars: Jidoka and Just-in-time

 Toyota defines just-in-time (JIT) as “the right part at the right
time in the right amount” (“at the right place”).
 JIT is one of the most well-known and least understood
buzzwords of modern manufacturing.
 Moving inventories around without reducing them or shortening
lead times is not JIT.



Lesson Three: Transferring Technologies
Easier Said Than Done

 Transferring technologies around the world is easier said than
done. JIT, more than any other of the system mechanics,
visibly distinguishes TPS from conventional manufacturing.
 JIT is a solution to the nightmare of trying to coordinate all of the
parts and materials that go into an automobile.
 Often, we fight complexity with complexity. JIT, however,
instructs us to learn to respond quickly and to roll with the
chaos.



Easier Said Than Done

 If you an understand the following two assumptions, you can
understand JIT:
 Production plans always change.
 Production will never go according to plan, anyway.
 Toyota’s JIT is a system unto itself comprised of pull system,
one-piece flow, and takt time, all of which are integrated with
Toyota’s heijunka method of production scheduling.
 The rest of JIT just will not work well without heijunka.



Heijunka

 Heijunka is a leveling of production (volume and variety).
 Production by heijunka:
 Creates a steady demand of resources,
 Shortens the lead time of individual product variation,
 Enables the leveling of the production process.
 Without heijunka, muda (waste) will build up increasingly from
beginning to end.
 Toyota establishes heijunka production planning on a monthly
basis, but does not lock in the actual production sequence.


Pull System: The Kanban System

 “Production plans will always change; production will never go
according to plan, anyway.”
 Usually we deal with the complexities of production scheduling
with equally complex forecasting and scheduling systems.
 In TPS, internal “customers” pull orders from internal “suppliers”
when they need it based on “sales” to their internal
“customers”.
 TPS fights complexity with simplicity – no forecasting
schedules for every process. No continuous reforecasting.



Pull System: The Kanban System

 Kanban is the Japanese word for “sign”. Kanban cards travel
with the parts and include part number, quantity, location, etc.
Usually small containers of a predetermined number of parts.
 If everyone follows the handful of clear rules for proper usage,
the kanban system is a foolproof way of making the right part
at the right time in the right amount.
 With the entire material and information flow transparent to
everyone, problems surface earlier and easier, and solutions
and improvements are easier to discover and implement.



One-Piece Flow

 Once we have a “customer pull”, we want simply to flow
everything one piece at a time.
 One-piece flow gets material from point A to point B with the
shortest lead time and least amount of work-in-process in
between.
 True one-piece flow would have no waiting time, no
queuing, and no batches.



One-Piece Flow

 Ideally all operations would be one-piece flow, but technology
sometimes won’t allow this.
 But it is always the goal and it is the philosophy.
 If we focus on how to reduce lead time, everything else will
come along.
 The path to reducing lead time is one-piece flow.



Takt Time

 Takt time is the tool to link production to the customer by
matching the pace of production to the pace of actual final
sales. Think musical meter and metronome.
 If blue Celicas are selling at a rate of one every half hour, we
should build one every half hour. And if half of those are air-
conditioned, then every other one on the line should have air.
 You calculate actual tact time for each product and part. That
determines the number of seconds you need in each actual
process in the entire production chain.
 Takt times are determined in the heijunka plan, once a month.


Takt Time

 Determining the takt time is usually where to begin in
establishing a JIT system.
 How many “supplier” parts are required by “customers”?
 How can we (then) create a process that can fulfill that
need with a minimum of waste and in the shortest lead
time?
 Minimum waste and shortest lead time should lead to
the same solution.



Lesson Four: Begin From Need

 Producing according to takt time puts customer needs out in
front of everyone all the time.
 People need to understand clearly the reasons for changing the
way they do things.
 Ohno believed that without a crisis no company would be
capable of successfully making the shift to lean
 At Toyota all proposals are challenged to demonstrate the need.
 “Never tell your staff what to do. Whenever you do that, you
take the responsibility away from them.”




 Lay out a problem. Ask for an analysis or a proposal, but
always stop short of saying “Do this.”
 The employee develops the solution (also should be finding the
problem, too).
 The manager is the “judge and jury” while the employee has the
“burden of proof” to justify the solution proposal.
 Say “No” a lot – three times, five times, ten times if necessary.



Policy Management: As Revolutionary as TPS

 This is the famous “bottom-up decision making.” It isn’t decision
making at all! It is solution proposal making!
 “Bottom- up” is not some kind of enlightened form of democratic
self-management where the worker decides what to do.
 But nobody is telling anyone else what to do. It is a beautiful
answer to the control-flexibility dilemma in all organizations.
 The company gets basic adherence to corporate direction, and
the workers are free to explore best possible real solutions to
problems they themselves know best.



Policy Management: As Revolutionary as TPS

 This is policy management – a management system or decision
making process that is probably as revolutionary as TPS itself.
 It is a system that is flexible and changes continuously, yet does
not accept change lightly or without strong justification.
 Policy deployment on a yearly basis and PDCA (plan, do, check,
action) on a daily basis.
 Policy management is not policy deployment (a prioritization
process in which the objectives are “deployed” into the
organization), but it should evolve from policy deployment.



Lesson Five: Ask the 5 Whys, Not the 5 Whos
 “The ability to focus on solving problems without pointing fingers
and looking to place the blame on someone.”
(Takeaway of NUMMI Americans at Toyota City)

 “No problem” sounds-out like “Monday night” in Japanese.
 “No problem” is a problem because there are always issues that
require some kind of “countermeasusure”; or at least there are
always better ways to accomplish a given task. Always.
 Standardized work, kaizen, and placing as much responsibility
as possible at as “low” a level as possible. This is what makes it
possible for a Toyota worksite to essentially run itself.


Lesson Five: Ask the 5 Whys, Not the 5 Whos
Standardized Work Alters Roles

 With standardized work, best practice is assured and becomes
the baseline for further improvement, or kaizen.
 No deviation from current standards is allowed, but if someone
has a better idea, that idea is easily proposed, approved, and
implemented (and rewarded), and becomes the new standard.
 Workers give a suggestion every 3 days or so. Also, takt time
changes every month (heijunka plan), and the standardized
work has to match the takt times. Change is good.
 Workers continually redesign their jobs; workers are engineers;
engineers are managers; and managers are psychologists.


Lesson Six: Don’t Confuse T’sPS with the TPS
 However unrealistic the implementation of TPS may be in a
particular instance, the ideals of TPS are still the ideals. “You
maybe can’t do one-piece flow out of stamping…yet.”
 Even 13 years after the birth of the joint GM-Toyota venture
NUMMI (New United Motors Manufacturing, Inc.) in Fremont,
CA, employees were wholly supportive…but…
 NUMMI had high quality Corollas and trucks, and a totally new
human resources system and a sense of membership…
 “What is the nature of our company-employee relationship?
 Commitment from management and trust from the employees.


Lesson Seven: Employee Motivation
 Employee motivation comes from (management) assuring
membership (to the employee) in the organization, whatever the
price tag.
 Toyota, even in Japan, does not guarantee lifetime employment.
 What an employer can do is make lay-offs (clearly) a last resort.
 Then real trust can develop between the company and
employees, along with the motivation for employees to accept
responsibility and ownership.


TPS Debate
 TPS Authority 1: “We’ll focus almost entirely on the plant floor,
just demonstrating how to implement. As companies implement
and begin to understand, they can do their own training.”
 TPS Authority 2: “But Americans need a rulebook. They don’t
like to play a game when they don’t know the rules. So we have
to give them the rules.”
 TPS Authority 1: “But there is no rulebook for TPS. If there is,
please give it to me; I want it, too. If you try to simplify it and
carve it in stone, it will lose its essence. All we can do is teach
guidelines and principles and demonstrate how to use the tools.”



Lesson Seven: Employee Motivation
Kaizen Workshop

 The kaizen workshop is a way to bring TPS to the shop floor.
 These are events of intensive team involvement for 4-5 days.
 Day 1 – training and explanation of the kaizen goals (not just “kaizen for
kaizen’s sake,” which becomes “change for change’s sake”).
 Day 2 – developing a kaizen plan from a given detailed current state analysis.
 Day 3 – implementing the plan (moving equipment, changing operator
movement, revising material and information flow).
 Day 4 – fix what didn’t work from Day 3.
 Day 5 – reporting to management and have confirmation of follow-up items.
 What’s good about kaizen workshops is their action focus. It’s
not so good if they’re not used as a strategic part of a larger plan
to get from here to there, and knowing where there is.


Lean Off the Plant Floor
 The thinking of TPS (or lean) applies to any function. It works
because it is a way of thinking; a whole systems philosophy.
 Lean thinking gives a broad perspective on providing goods and
services that goes beyond the bottom line and the stodgy
principles of mass-producing capitalism.
 It is a human system – customer focused, customer driven – in
which employees are also customers.
 Lean asks: “What adds value for my customer?” and reveals a
transparency that allows any work situation to be easily
understood at a glance, and always open for improvement.



Lesson Eight: There Are No Experts
 Yes, we’ve improved quality, but at what cost? How much better
is our in-plant, first-time-through performance?
 We’ve moved inventories around, but have we scrapped batch
and queue for flow? Have we trashed our complex push
scheduling systems for customer demand-based pull?
 Are we focusing on shortening lead times through eliminating
waste and its sources?
 Have we built human resource systems that make people
integral members of the enterprise?
 Have we adopted the philosophy and the way of thinking?


Veritas


Thank You!


 Managing to Learn: Using the A3 Management Process
Managing to Learn by Toyota veteran John Shook, reveals the thinking underlying the vital A3 management process
at the heart of lean management and lean leadership. Constructed as a dialogue between a manager and his boss,
the book explains how A3 thinking helps managers and executives identify, frame, and then act on problems and
challenges. Shook calls this approach, which is captured in the simple structure of an A3 report, the key to Toyota's
entire system of developing talent and continually deepening its knowledge and capabilities. The A3 Report is a
Toyota-pioneered practice of getting the problem, the analysis, the corrective actions, and the action plan down on a
single sheet of large (A3) paper, often with the use of graphics. A3 paper is the international term for a large sheet of
paper, roughly equivalent to the 11-by-17-inch U.S. sheet. The widespread adoption of the A3 process standardizes
a methodology for innovating, planning, problem-solving, and building foundational structures for sharing a broader
and deeper form of thinking that produces organizational learning deeply rooted in the work itself, says Shook.
Management expert James Womack predicts Managing to Learn will have a deep impact on the way lean companies
manage people. He believes readers will learn an underlying way of thinking that reframes all activities as learning
activities at every level of the organization, whether it's standardized work and kaizen at the individual level, system
kaizen at the managerial level, or fundamental strategic decisions at the corporate level. A unique layout puts the
thoughts of a lean manager struggling to apply the A3 process to a key project on one side of the page and the
probing questions of the boss who is coaching him through the process on the other side. As a result, readers learn
how to write a powerful A3 - while learning why the technique is at the core of lean management and lean leadership.

 Paperback: 138 pages
 Publisher: Lean Enterprise Institute, Inc.; 1 edition (January 2008)


Becoming lean john shook lean manufacturing

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