All over for the Lean Movement?

End of the road?

Longer Thought Piece:

At the end of the 1980’s The Toyota Motor Company raised eyebrows when it finally started to share its performance metrics with the rest of the automotive world. Toyota was not only better than all of the other players in the industry, it was; way, WAY, better. Initially their data triggered much in the way of patronising commentary, along with many false assumptions about how that performance was being achieved. Subsequent visitors to actual Toyota plants however were soon being treated to candid explanations for how they were doing it. The initial message could be summarised simply in the claim that, “We are Toyota we do things differently here”. These visits and explanations were, in hindsight, the first of many missed opportunities. To the the un-trained eye, especially at-a-glance, Toyota plants as they still do today, looked pretty much like any other car plant did at the time. As a young engineer I listened intently to the senior leaders from our Business who had undertaken such ‘Industrial Tourism’ visits to Japan - typically seeing Toyota or one of its first tier suppliers. Most of these envoys, who didn’t even understand our own manufacturing system at that time, came back singularly un-impressed. Much of that was saying more about their inability to ‘see’ any differences rather than any qualitative assessment of the superior businesses they had paid to visit. One particular comment I still remember like it was yesterday was: “They (Toyota supplier) are way behind us, our skills, machines and technology are far beyond theirs.” Right in that moment I remember thinking, if a senior leader from our business, whom I had trusted would be able to ‘see’ key information, had failed to see the massively superior productivity, quality, time based performance and deep engagement of ordinary workers in extraordinary rates of improvement then we were already in deep trouble.

How could that be?

In part therein lies one problem at the heart of The now called Lean movement. The Toyota Production System (TPS) and its foundational beliefs, The Toyota Way, require a fundamental enlightenment to actually see in full. Having done that, which few do, it also requires an honest contrast to what went before or one’s own workplace is doing right now. Only then can you honestly recognise its epoch making advances. To really get Lean deeply, such that you become fully enlightened, you can only do so by doing an upgrade yourself...

When Toyodaism was codified and re-presented to the world almost a decade later it was in an attempt to mainstream knowledge of the different ways that Toyota Worked. The book Lean Thinking by Jim Womack & Dan Jones [August 1996] sought to explain from their observed first principles. What had actually amounted to a major upgrade to the normal way the automotive industry worked. The Toyota Way was a new post-Ford model. Toyodaism, which is this authors term created in deference to the Toyoda family, was enough of an upgrade to warrant a new status in the way all humans could work. Few outside the sector however embraced the opportunity.

In my most recent book - Work 5.0 ; Work 4.0 or Toyodaism (popularly known as Lean) I consider as the 4th great evolution of human work. However, even now, some four decades on from its first appearance outside its inventors organisation, the true potential of Lean remains barely tapped at all.

Why Is that?

When Toyota made its first pioneering journey of transformation it started in truly extraordinary circumstances and also at a highly relevant but always under reported starting point. In hindsight many of the circumstances Toyota faced have not been present within the many organisations seeking to recreate a so-called Lean Transformation for themselves.

Consider the following:

Firstly, Toyota had had a very damaging 16 week strike which was caused by a do-or-die post-war efficiency drive. This had been conducted via traditional time and motion study based efforts and had cost many Toyota people their jobs and mental wellbeing. The strike was called as a direct result of this efficiency drive. The strike was only ended when the company president metaphorically fell-on-his-sword by standing down and made a solemn pledge. This pledge was that if the strike was ended, no worker in Toyota would ever lose their job as a result of improvements being made.

Secondly, with the post-war entry of Western Automakers into Japan, Toyota had a compelling need for change, an urgent compete or die mission, to improve their comparatively poor performance. No one in the company, leader or worker alike, could ignore the gravity of the situation.

Thirdly, having already embraced the founders technological innovation of Jidoka (automatically stopping machines when a defects occurred and therefore leaving automatic machines to run without a full-time human observer), Toyota created a unique take on, the way things should be made. Unlike the obsession with worker ‘busyness’ and economies of scale that most of the industry had, Toyota people were already programmed to, stop work immediately when defects occurred and to fix problems at source via teams working on problems in real-time. This was in direct contrast to the industry norm where problems were taken off-line and solved later by others. In short “the more we stop (and fix things at source) the better we get” belief was unique to Toyota.

Fourthly, Toyota executives themselves personally drove the companies transformational response to their post-war challenge. They did so by re-laying out their workflow in a series of Kaikaku (Strategic Step Changes). Working with trade associations like the Japanese Management Association, adopting the teachings of W.E. Deming and via the guidance of consultants like Shigeo Shingo, their long term transformational journey was in sharp contrast to western managements orthodoxy of delegation and the pursuit of quick fixes.

Fifth, but not finally, Toyota created a human centred system by mobilising and teaching its entire workforce the fundamental principles of their vision. What they were able to see was the difference between wasteful and value-adding work and how flow based working and root cause problem solving could in the long term give an advantage. This whole team approach was done to both, cement the Kaikaku enabled building blocks of transformational change done by leaders, and to empower a team based incremental improvement ethos called Kaizen (Many small improvements) initiated by the workers themselves.

With this unique approach to the way work should be done and improved continuing for well over three decades. Toyota used their step-change improvement approach to create a real leaps forward with each new model. Its production and supply chain flows were each laid out, knowing that the workforce would build on that via continuous incremental improvements thereafter. Toyota has, since then, continued to work on its unique; backwards-thinking, counterintuitive, self-healing and self improving system as originally envisaged by Kiichiro Toyoda’s twin ideals of Jidoka attitude and Just-In-Time working.

The Just-In-Time system of people, plant and processes aims for an uninterrupted flow of value along with the lowest, class leading levels of working capital. By its very design, JIT automatically stops and shows leaders and their teams the next biggest problem that needs solving. Indeed, as long as you remember to first create flow, the system itself along with motivated staff becomes the manager of its own improvement. Eiji Toyoda has to be given huge credit for then taking the reins from Kichiiro and sticking with and continuing to drive the system forward. Instead of stopping at every problem and reasoning that Just-In-Time would never work, he realised that it was in seeking to overcome every problem, that ultimately genuine underlying performance would get better quicker. To this day I still see people giving up on Lean / Just-In-Time / Toyodaism, often right after learning its key principles and encountering the first problems they can think of. Many do so entirely intellectually in their own heads before ever trying it. “That will never work here” must have been heard many times by Kiichiro & Eiji and over decades too!
So ,what made them persevere?

Answer: They had no choice, they had to make it work. The threat of their competition was ever present and ready to eat them up.

People in the middle of Lean transformations often ask me: “When will the tipping point come? When will our new way of working sustain itself without reverting back to the old way?

The quick answer these days is “when the pain of pursuing the new way is clear and obviously less painful than the rose-tinted memories of the old way of doing things”. Realistically this takes about three years with a strong and relentless pace of top-down / bottom-up transformation.

So with all that said it is no coincidence that Toyota, almost uniquely, kept a leadership and workforce alike engaged in solving underlying problems such that their counterintuitive way of organising work became their new normal. To do this and for it to endure, they have had to have now four generations of leaders commit to the approach and to never ever let-up on making it the way they do things.

So, apart from a few limited examples outside of Toyota where a so-called Lean transformation has endured beyond a leadership change and some partial aspects having been adopted in other sectors - Noticeably - Just In Time Logistics, I would claim that the full potential for Lean Thinking has remained lamentably unfulfilled.

This leaves the following question, is it ever going to be possible to see a wholesale adoption of Lean Thinking?

This author remains sceptical for the following reasons:

Why?
Although the knowledge has superficially existed for more than thirty years, much of it has been watered down through either: increasingly complex derivations of the basic principles and at the same time number of people available with the ability to teach from first principles at an enterprise level has not grown at the rate required. The former has increased steadily with every newly minted internet enabled Lean Expert and the latter has in been in steady decline during the same timeframe due to old age and retirement.

Why has the knowledge taken the path it has?

1. When the Knowledge of Lean came to the west in the 1980’s our teachers were either current, or ex-senior leadership post holders. As well as these executives there were also the creative elders of the Toyota system and their Keiretsu (business network) disseminating the knowledge. As a result most were either close to retirement or indeed already retired from the very organisation they had transformed. This first generation of teachers were what this author calls the actual architects, builders and transformers of the system. They were the ones that physically re-configured their own conventional factory layouts for flow and built pull systems in intensive step-change focussed Kaikaku events. They were the ones who then connected these changes and had to create practical solutions like, Team based problem solving, Kanbans and Jidoka devices to make the new way or work succeed. The next generation were equally committed to these new ways of working, having seen the benefits but in my personal experience, were now more the sustainers and incremental improvers of the system. They were, as a result, through no fault of their own, noticeably lacking when it came to guiding radical transformational change. So whilst these new generation of teachers were fully competent to facilitate and teach ongoing Kaizen, few could guide leaders through the fundamental end-to-end upgrade drive via Kaikaku. This critical knowledge gap between the two was already there by the 1990’s

2. As Lean Thinking broke cover and went from an underground thing of a few organisations doing transformation under the guidance of the elders mentioned above, the Leader-read-a-book effect, and traditional consultancy approaches took over. In the west in particular, Lean Thinking became a victim of western leaderships propensity for delegation and also to hire the cheapest help it could find in the lowest cost quote traditions. This was, an instinctive but fatal error of judgement in most cases. With the responsibility for transformation now delegated to those with the least power to enable it, many tasked with such work, found it an impossible task. Lean Thinking’s core ideals, as proved by the limited number of success cases, are very leadership intensive to implement and require multi-year, cross-functional focus. In short, to do the heavy lifting of lean transformation, you have to do so despite the typical organisation structure and existing ways of doing things. That takes leadership at every level and that, in this authors experience, means that almost everyone involved has to act at least a half-step above their current pay grade to ensure success. People prepared to do this are again in vanishingly short supply.

3. Next, the lack of what I call stop-its within the majority of Lean transformations mean that instead of Lean Principles proving the truth of the name, many organisations, once they have made some transformation, fail to actively capitalise on it. The best way to do this is to increase demand by selling the benefits of higher capability to customers. This is best done by selling increased speed of response, higher quality and better value. The resulting growth avoids the short term instinct for downsizing but at the same time we must actively remove the old ways of working instead of leaving them lying around ‘just-in-case’. This is common all over improvement practices not just with Lean per se. What does the new way allow us t remove?

Without freeing up existing capacity for growth, further improvement cannot take place. Without leaders attending to these specifics of transformation it means that the sustaining aspects such as; find a problem, stop, swarm, study, and improve becomes optional. If that happens the gains will be marginal at best. This critical follow-through can only be pursued with continued leadership attention and hands-on engagement.

4. Without a burning platform and a do-it-to-survive reason for transformation, the initial hard yards often seem too high a price to pay and soon people talk themselves out of transformation before they have even started. The majority of leaders in the current world of work are not transformational leaders, they are Managers. Many Managers will do anything for a quiet life and most have a short term tenure view of their career. As long as, not much goes wrong on their watch, that is seen as success for most. Transformational leaders on the other hand are in much shorter supply. They are mission driven towards significant transformations and step-change and therefore view success more by the lasting legacy they leave rather than the day-to-day.

5. Finally, in this admittedly limited list of failure modes, the pandemic and its, do we do remote working or not-do remote working debate has taken inquiry and demand for new ways of working down a bit of a narrow cul-de-sac. Yet again we seem to be at another juncture that presents the way we work as a mere style, or personal preference choice, rather than a qualitative and quantitive selection to be made.
If you and critically your customers you serve, are happy with the outcomes that working at lower levels of human working such as 1.0 to 2.0 create then to work remote or not hardly seems to matter at all. If however you feel like you are always running to stand still and sense that you need to be working at a higher levels (4.0 and above) to compete and achieve goals then a work upgrade path is urgent and vital.

And so what of the initial question - Is it allover for the Lean Movement?

I would say yes, in the current form, with the current knowledge base missing so many of the vital elements and the lack of people of the calibre required to make sustainable improvement, we need a more comprehensive way of upgrading the way things are done that has forever results. Places where work 1.0/2.0/3.0 are the norm will be likely wiped out in many sectors before they realise “what happened?” and only those that consciously upgrade holistically will survive.

In areas where work 4.0 (Lean) has already evolved to work 5.0, the lean movement has been built upon, but now in some ways been left behind. As so-called Agile Working and an On-Demand Economy better serves customers it means that some form of hybrid working may well become the norm for most workers. Again we have to have a much better way of getting there and ensuring that we don’t simply create hybrid versions of lower forms of working.

With new start-ups it is vital that they do not have to go through any unnecessary lower evolutions of work as quicker more enlightened competitors will inevitably start with more advance models and get there first. Starting at work 5.0 should be a deliberate act for any new start-up designing its business model.

So where does all that leave the Lean Movement?

There are now a multitude of Lean initiatives ongoing and an excess of Lean Consulting companies to serve them buried in the middle of organisations doing Kaizen activities here and there. Typically working with internal change agents instead of the leadership, both produce results and positive change but nothing like what is possible or sustainable for the long term. No surprise then that such work seldom connects together in a rational way, nor shows tangible results at the P&L level. Sure the celebrations at the end of these activities fill the internal magazines and create warm feelings but the end customers and wider stakeholders mostly feel nothing. I call this the Ghettos Of Excellence problem.

With flat-lining economies and productivity being static for decades, it is time we go beyond this current state of affairs and take more holistic approaches to upgrading work that get results at a meaningful level and ultimately are more sustainable and speak to more than just limited process process improvements.

If you would like to continue the discussion in the light of your own workplace and Work 5.0 feel free to contact us.