Lean Implementation Develops from TPS

Lean Leadership

The role of the leaders within the organization is the fundamental element of sustaining the progress of lean thinking. Experienced kaizen members at Toyota, for example, often bring up the concepts of Senpai, Kohai, and Sensei, because they strongly feel that transferring of Toyota culture down and across Toyota can only happen when more experienced Toyota Sensei continuously coach and guide the less experienced lean champions.

One of the dislocation effects of lean is in the area of key performance indicators (KPIs). The KPIs by which a plant/facility are judged will often be driving behavior, because the KPIs themselves assume a particular approach to the work being done. This can be an issue where, for example a truly lean, Fixed Repeating Schedule and JIT approach is adopted, because these KPIs will no longer reflect performance, as the assumptions on which they are based become invalid. It is a key leadership challenge to manage the impact of this KPI chaos within the organization.

Similarly, commonly used accounting systems developed to support mass production are no longer appropriate for companies pursuing lean. Lean accounting provides truly lean approaches to business management and financial reporting.

After formulating the guiding principles of its lean manufacturing approach in the TPS, Toyota formalized in 2001 the basis of its lean management: the key managerial values and attitudes needed to sustain continuous improvement in the long run. These core management principles are articulated around the twin pillars of Continuous Improvement (relentless elimination of waste) and Respect for People (engagement in long‐term relationships based on continuous improvement and mutual trust).

This formalization stems from problem solving. As Toyota expanded beyond its home base for the past 20 years, it hit the same problems in getting TPS properly applied that other Western companies have had in copying TPS. Like any other problem, it has been working on trying a series of countermeasures to solve this particular concern. These countermeasures have focused on culture: how people behave, which is the most difficult challenge of all. Without the proper behavioral principles and values, TPS can be totally misapplied and fail to deliver results. As with TPS, the values had originally been passed down in a master‐disciple manner, from boss to subordinate, without any written statement on the way. Just as with TPS, it was internally argued that formalizing the values would stifle them and lead to further misunderstanding. However, as Toyota veterans eventually wrote down the basic principles of TPS, Toyota set to put the Toyota Way into writing to educate new joiners.

Continuous Improvement breaks down into three basic principles:

1. Challenge: Having a long‐term vision of the challenges, one needs to face to realize one’s ambition (what we need to learn rather than what we want to do and then having the spirit to face that challenge). To do so, we have to challenge ourselves every day to see if we are achieving our goals.
2. Kaizen: Good enough never is, no process can ever be thought perfect, so operations must be improved continuously, striving for innovation and evolution.
3. Genchi Genbutsu: Going to the source to see the facts for oneself and make the right decisions, create consensus, and make sure goals are attained at the best possible speed.

Respect for People is less known outside of Toyota and essentially involves two defining principles:

1. Respect: Taking every stakeholders’ problems seriously, and making every effort to build mutual trust. Taking responsibility for other people reaching their objectives.
2. Teamwork: This is about developing individuals through team problem‐solving. The idea is to develop and engage people through their contribution to team performance. Shop floor teams, the whole site as team, and team Toyota at the outset.