Lean Primer

LEAN PRIMER
byCraigLarmanandBasVoddeVersion1.6
Pleasesenduscommentsforfutureversions,atwww.leanprimer.com.Note:Checkwebsitefor
latestversion;sharetheURL(ratherthanfile)tokeepuptodate.
CraigLarmanandBasVoddearetheauthorsofScalingLean&AgileDevelopment.
Theyworkasmanagementcoachesinorganizationsadoptingleanthinking.
Forconsultingormoreinformation,pleaseseecraiglarman.comandodde.com.
Note:LeanthinkingandtheToyotaWayarelargesubjects,spanningapplicationto
productdevelopment,service,sales,HR,andproduction,andspanningmanyfunctions:
management,design,delivery,andmore.Weencouragedeeperstudy;seeRecommended
Readingsattheend.
TABLE OF CONTENTS
Introduction2LeanThinking:TheBigPicture3Background7Lean
Summary:TheLeanThinkingHouse8LeanGoal:SustainablyDeliverValueFast
9LeanFoundation:LeanThinkingManagerTeachers10PillarOne:Respectfor
People12PillarTwo:ContinuousImprovement1414Principles25LeanProduct
Development34
www.leanprimer.comCopyright(c)CraigLarman&BasVodde2009Allrightsreserved
LeanPrimer
INTRODUCTION
Ihaveenoughmoneytolastmetherestofmylife,unlessIbuysomething.
JackieMason
Leanthinkingisaprovensystemthatappliestoproductdevelopmentand
production,asevidencedbyToyotaandothers.Andalthoughmostoftenapplied
toproducts,itisalsousedinserviceareasbothwithinToyotaandindomains
suchashealthcare1.
Theimageandmetaphorweliketoconveyakeythinkingmistakeand
opportunityisthesportofrelayracing.
Considertherelayracersstandingaroundwaitingforthebatonfromtheirrunning
colleague.Theaccountantinthefinancedepartment,lookingaghastatthis
terribleunderutilizationwasteindicatedinsomereport,wouldprobably
mandateapolicygoalof95%utilizationofresourcestoensurealltheracersare
busyandproductive.Maybehesuggeststherunnerscouldrunthreeraces
at
thesametimetoincreaseresourceutilization,orrunupamountainwhile
waiting.
Funny...butthiskindofthinkingliesbehindmuchoftraditionalmanagementand
processesindevelopmentandotherdomains.2Ofcourse,incontrast,hereisa
centralideainleanthinking:
1.
Forreadersworkinginservicedomains,notethatmostleanprinciplesareverygeneral,
suchascontinuousimprovementmindsetandmanagerteacherswhoareworkexperts
andactasmentors.Someprinciplesrequireminortranslation,suchaslongtermgreat
engineerstolongtermgreathandsonworkers,ornewproductdevelopmenttonew
service.
2.
See,forexample,PRTM[McGrath96,McGrath04]forcollectionsoftraditionaland
unleanproductdevelopmentideas.
2
Watchthebaton,nottherunners.
LeanThinking:TheBigPicture
Doesyourorganizationmeasureproductivityorefficiencyintermsofhow
busypeopleare,ortimespentwatchingtherunner?Or,intermsoffastdelivery
ofvaluetotherealcustomerwatchingthebaton?Whatisthevaluetowaste
ratioinyourwork?Andwhataretheimpedimentstotheflowofvalueandhow
canpeoplefeelinspiredtocontinuouslystrivetoimprovethatflow?Leanthinking
addressesthis.
LEAN THINKING: THE BIG PICTURE

Lean(orleanthinking)istheEnglishnamepopularizedbyMITresearchers
todescribethesystemnowknownastheToyotaWayinsidethecompanythat
createdit.3Toyotaisastrong,resilient,companythatseemstoimproveovertime:
In2008surpassedGMtobecomethelargestvehiclecompanybysales,while
beingmuchmoreprofitable.
J.D.Power(etc.)consistentlyrateToyota,Lexus,andScionamongthetopin
quality.
In2006profitwas$13.7USDbillion,whileGMandFordreportedlosses.a
MarketcapitalizationinMay2007wasover1.5timesthatofGM,Ford,and
DaimlerChryslercombined.
Innovativewithsocialandenvironmentalawarenessforexample,creatorof
thePriusandhybridtechnology.
Productdevelopmentatlevelsuptotwiceasfastassomecompetitors.
a.In2009,aftertheworldwidefinancialcrisis,GMenteredbankruptcyprotection.
Toyota,whilesufferinglossesalongwithotherautomotivecompanies,remainssolvent.
Thisisasample;ExtremeToyota[OST08]dedicatesachaptercomparingtheir
sustainableperformancecomparedtoothersintheirindustry.Thatsaid,Toyota
isfarfromperfectandthereareuniquethingstolearnfromothersystems(suchas
agilemethodsinsoftwaredevelopment)thatarenotfoundinleanthinking.We
arenotsuggestingthatToyotaorleanthinkingistheonlymodeltolearnfrom,or
tosimplyemulateit.Neverthelessitisalongrefinedmeritorioussystemfroma
relativelyrobustandsustainablecompany.
3.TheoriginalnamewasRespectforHumanitySystem.SomecalleditTheThinking
Way.TheseemphasizedaToyotacultureofmentoringpeopletothinkthroughand
resolverootcausestoproblems,tohelpsociety,andtohumanizework[Fujimoto99,
WJR90].

LeanPrimer
The Pillars of Lean Are Not Tools and Waste ReductionTherearesome
commonmisconceptionsaboutlean.Thisprimerstartswithclearing
theseaway.WhatistheessenceandpowerofleanthinkingandToyota?
WhenIfirstbeganlearningaboutTPS4,Iwasenamoredofthepowerof[one
pieceflow,kanban,andotherleantools].Butalongtheway,experiencedleaders
withinToyotakepttellingmethatthesetoolsandtechniqueswerenotthekeyto
TPS.RatherthepowerbehindTPSisacompanysmanagementcommitmentto
continuouslyinvestinitspeopleandpromoteacultureofcontinuous
improvement.InoddedlikeIknewwhattheyweretalkingabout,andcontinuedto
studyhowtocalculatekanbanquantitiesandsetuponepieceflowcells.After
studyingforalmost20yearsandobservingthestruggles[other]companieshave
hadapplyinglean,whattheseToyotateacherstoldmeisfinallysinkingin.
[Liker04](emphasisadded)
WakamatsuandKondo,Toyotaexperts,putitsuccinctly:
Theessenceof[theToyotasystem]isthateachindividualemployeeisgiventhe
opportunitytofindproblemsinhisownwayofworking,tosolvethemandto
makeimprovements.[Hino06]
Management Tools Are Not a Pillar of Lean
Theabovequotesunderscoreavitalpointbecauseovertheyearstherehavebeen
someostensiblyleanpromotersthatreducedleanthinkingtoamechanistic
superficiallevelofmanagementtoolssuchaskanbanandqueuemanagement.
ThesederivativedescriptionsignorethecentralmessageoftheToyotaexperts
whostressthattheessenceofsuccessfulleanthinkingisbuildingpeople,then
buildingproductsandacultureofchallengethestatusquocontinuous
improvement[Hino06].
Reducingleanthinkingtokanban,queuemanagementandothertoolsislike
reducingaworkingdemocracytovoting.Votingisgood,butdemocracyisfar
moresubtleanddifficult.ConsidertheinternalToyotamottoshowninaphotowe
tookwhenvisiting
4.ToyotaProductionSystem(TPS)istheprecursortotheToyotaWay[Ohno88].
4
LeanThinking:TheBigPicture
ToyotainJapansomeyearsago;itcapturestheheartoflean,summarizingtheir
focusoneducatingpeopletobecomeskillfulsystemsthinkers:
Tosimplifyleanthinkingtotoolsistofallintoatraprepeatedmanytimesbefore
bycompaniessuperficiallyandunsuccessfullyattemptingtoadoptwhatthey
thoughtwaslean.
...itwasonlyafterAmericancarmakershadexhaustedeveryotherexplanation
forToyotassuccessanundervaluedyen,adocileworkforce,Japaneseculture,
superiorautomationthattheywerefinallyabletoadmitthatToyotasreal
advantagewasitsabilitytoharnesstheintellectofordinaryemployees.
[Hamel06]
Consequently,LeanSixSigma5isviewedbyToyotapeopletorepresentSix
Sigmatoolsbutnottorepresentrealleanthinking.AformerToyotaplantandHR
managerexplains:
Leansixsigmaisacompilationoftoolsandtrainingfocusedonisolatedprojects
todrivedownunitcost...TheToyotaapproach[...]isfarbroaderandfardeeper.
ThestartingpointistheToyotaWayphilosophyofrespectforpeopleandcontinu
ousimprovement.Theprincipleisdevelopingqualitypeoplewhocontinually
improveprocesses...Theresponsibilitylies,notwithblackbeltspecialists,but
withtheleadershiphierarchythatrunstheoperationandtheyareteachersand
coaches.[LH08]
Waste Reduction Is Not a Pillar of Lean
ThebookLeanThinking[WJ96]wasjustifiablypopularandintroducedsome
Toyotaideastoamuchwideraudience.Werecommenditwhileobservingthat
itpresentsacondensedviewoftheToyotasystem.LeanThinkingdraws
significantlyonresearchfromthe1980sandearly1990sthatfocusedonToyotas
productionsystem[WJR90],andwaspublishedbeforeToyotasownToyotaWay
2001GreenBook,thatsumma
5.LeanSixSigmaisanamalgamoftoolspromotedintheSixSigmamovement
[George02].
LeanPrimer
rizedthepriorityofthebroaderprinciplesfromaninsidersperspective.The
subtitleofLeanThinkingisBanishWasteandCreateWealthinYour
Organization,andsonotsurprisingly,thosewhohavereadonlythatonebook
oftensummarizeleanasremovingwaste.
Althoughuseful,wastereductionisnotapillaroflean;itisonlymentioned
severallevelsdeepwithintheToyotaWay2001.Plus,inLeanThinking,some
preeminentleanprinciplessuchasGoSee(thatToyotahighlights)aretreatedin
anentertainingbutonlyanecdotalorsecondarystylethatmakeitpossibletomiss
therelativeimportanceofsomeleanprincipleswithinToyota.StudyLean
Thinking,andstudymoreoftheRecommendedReadings.
The Two Pillars of Lean
Whatarethepillarsoflean?ToyotapresidentGaryConvis:
TheToyotaWaycanbebrieflysummarizedthroughthetwopillarsthatsupportit:
ContinuousImprovementandRespectforPeople.Continuousimprovement,
oftencalledkaizen,definesToyotasbasicapproachtodoingbusiness.Challenge
everything.Moreimportantthantheactualimprovementsthatindividualscon
tribute,thetruevalueofcontinuousimprovementisincreatinganatmosphereof
continuouslearningandanenvironmentthatnotonlyaccepts,butactually
embraceschange.Suchanenvironmentcanonlybecreatedwherethereis
respectforpeoplehencethesecondpillaroftheToyotaWay.(emphasisadded)
AndfromToyotaCEOKatsuakiWatanabe:
TheToyotaWayhastwomainpillars:continuousimprovementandrespectfor
people.Respectisnecessarytoworkwithpeople.Bypeoplewemean
employees,supplypartners,andcustomers....Wedontmeanjusttheend
customer;ontheassemblylinethepersonatthenextworkstationisalsoyour
customer.Thatleadstoteamwork.Ifyouadoptthatprinciple,youllalsokeep
analyzingwhatyoudoinordertoseeifyouredoingthingsperfectly,soyoure
nottroublingyourcustomer.Thatnurturesyourabilitytoidentifyproblems,
andifyoucloselyobservethings,itwillleadtokaizencontinuousimprovement.
TherootoftheToyotaWayistobedissatisfiedwiththestatusquo;youhaveto
askconstantly,Whyarewedoingthis?(emphasisadded)
Respectforpeopleandcontinuousimprovementchallengeeverythingembrace
changemindset,thepillarsoflean,areexpandedlater.Ifaleanadoptionprogram
6
Background
ignorestheimportanceoftheseacargocultleanadoption6thentheessential
understandingandconditionsforsustainablesuccesswithleanwillbemissing.
BACKGROUND
TheEnglishtermleanwaspopularizedfortheToyotasystembyMIT
researchersofToyotainTheMachineThatChangedtheWorld[WJR90]to
contrasttheirleanproductionwiththealternativeofmassproduction.The
implicationwasadramaticreductioninworkpackageorbatchsize,andnolonger
competingoneconomiesofscalebutrathercompetingontheabilitytoadapt,
avoidinventory,andworkinverysmallunits.Thetermleanisnowalsoused
withinToyota;forexample,intheirToyotaWay2001internalbooklet.
TwooftheauthorsoftheTheMachineThatChangedtheWorldwentontowrite
LeanThinking,apopularintroductionthatsummarizedfiveprinciples.
RelativelybroaddescriptionsoftheleansystemareTheToyotaWay,TheToyota
ProductDevelopmentSystem,InsidetheMindofToyota,ExtremeToyota,and
LeanProductandProcessDevelopment.AllarebasedonlongstudyofToyota.
TheToyotaWay[Liker04]textisusedbyToyotaforeducation,inadditiontotheir
internalToyotaWay2001.Thisintroductiontoleanissimilartothese
descriptions.
6.Acargocultinatribalsocietyperformedritualsimitatingthebehaviorofnonnative
visitors(oftenfromEurope).Byanalogy,cargocultprocessadoptionsuggestsritualism
andsuperficiality.Cargocultleanadoptionimpliesadoptingleantoolswithoutthe
transformationtoaleanstateofmindandbehaviorbymanagement.
Figure 1.1 the lean-thinking house

LeanPrimer
Sustainable shortest lead time, best quality and value (to people and society), most customer delight,
lowest cost, high morale, safety
Respect for People
Continuous
Improvement
- don_t trouble your _customer_
- Go See
- develop people, then build

products
- no wasteful work
- teams & individuals evolve their Product Development
own practices and improvements
- long-term great engineers - mentoring from
manager- build partners with stable
- kaizen- spread
knowledge - small,
relentlessretrospectives- 5 Whyseyes for waste
* variability, overburden, NVA ...
relationships, trust, and coaching

engineer-teacher- cadence- cross-functionalin lean thinking
(handoff, WIP, info
team room + visual mgmt - entrepreneurial
scatter, delay, multichief
- develop teams
tasking, defects, wishful
engineer/product mgr- set-based concurrent thinking..)
dev - create more knowledge
- perfection challenge
14 Principles
- work toward flow
long-term, flow, pull, less
(lower batch size,
variability & overburden, Stop & Fix, master
Q size, cycle time)
norms, simple visual mgmt, good tech, leaderteachers from within, develop exceptional
people, help partners be lean, Go See,
consensus,
reflection & kaizen

Management applies and teaches lean thinking, and bases decisions on this long-term philosophy
LEAN SUMMARY: THE LEAN THINKING HOUSE

Figure1.1summarizesthemodernToyotaWayinaleanthinkinghouse
diagram,becauseanearlierversionoftheToyotasystemwasfirstsummarized
withinToyotabyasimilarhousediagram7.Thishousealsodefinesthemajor
sectionsofthisprimer,
7.FujioCho,wholaterbecomeToyotachairman,sketchedthefirstToyotaProduction
Systemhousediagramin1973.
8
LeanGoal:SustainablyDeliverValueFast
suchasRespectforPeopleandContinuousImprovement.Theremainderofthe
primerfollowsthemajorelementsofthediagraminthefollowingorder:
1.goal(roof)
2.foundation
3.pillarrespectforpeople
4.pillarcontinuousimprovement
5.14principles6.leanproductdevelopment
LEAN GOAL: SUSTAINABLY DELIVER VALUE FAST

Sustainableshortestleadtime,bestqualityandvalue(topeopleandsociety),most
customerdelight,lowestcost,highmorale,safety.
Broadly,theglobalorsystemgoalofleanthinkingistoquicklydeliverthingsof
value(tothecustomerandsociety)inshorterandshortercycletimesofall
processes,whilestillachievinghighestqualityandmoralelevelsflowofvalue
tothecustomerwithoutdelay.Toyotastrivestoreducecycletimes,butnot
throughcuttingcorners,reducingquality,oratanunsustainableorunsafepace;
rather,byrelentlesscontinuousimprovement,thatrequiresacompanycultureof
meaningfulrespectforpeopleinwhichpeoplefeeltheyhavethepersonalsafety
tochallengeandchangethestatusquo.
WeseeechoesofthisgoalinthewordsofthecreatoroftheToyotaProduction
System(TPS),TaiichiOhno:
Allwearedoingislookingatthetimeline,fromthemomentthecustomergives
usanordertothepointwherewecollectthecash.Andwearereducingthetime
linebyreducingthenonvalueaddingwastes.8[Ohno88]
So,afocusofleanisonthebaton,nottherunnersremovingthebottlenecksto
fasterthroughputofvaluetocustomersratherthanlocallyoptimizingbytryingto
maximizeutilizationofworkersormachines.
8.Thisallusiontowastesisexploredlater.Wastehasanimportantandspecificmean
inginleanthinking.
Goal
Product
Development
14
Principle
s
Foundation
Respect for People

Continuous Improvement
LeanPrimer
NotonlydoesToyota(andtheirLexusandScionbrands)manufacturevehicles,
butalsosuccessfullyandefficientlydevelopnewproductsleanprinciplesapply
toproductdevelopment.HowdoesToyotaachievetheglobalgoalintheirtwo
mainprocesses,productdevelopmentandproduction?
Developmentoutlearnthecompetition,throughgeneratingmore
usefulknowledgeandusingandrememberingiteffectively.
Productionoutimprovethecompetition,byafocusonshortcycles,
smallbatchesandqueues,stoppingtofindandfixtherootcauseofproblems,
relentlesslyremovingallwastes(waiting,handoff,...).Thisprimerreturnsto
outlearnandoutimprovelateron.Ofcourse,theseapproachesarenotmutually
exclusive.ToyotaDevelopmentimprovesandProductionlearns.LEAN
FOUNDATION: LEAN THINKING MANAGER-TEACHERS Management
appliesandteachesleanthinking,andbasesdecisionsonthislongterm
philosophy.WhenwefirstvisitedToyotainJapan,weinterviewedpeopletolearn
moreabouttheirmanagementcultureandeducationsystem.Oneofthethingswe
learnedisthatmostnewemployeesfirstgothroughseveralmonthsofeducation
beforestartingotherwork.Duringthisperiodtheylearnthefoundationsoflean
thinking,theylearntoseewaste(asubjectwewillreturnto),andtheydohands
onworkinmanyareasofToyota.Inthisway,newToyotapeople...
learnproblemsolvingthroughhandsonimprovement
experiments
learntoseehowleanthinkingappliesindifferentdomains
learnkaizenmindset(continuousimprovement)
appreciateacoreprincipleinToyotacalledGoSeeandgemba
GoSeemeanspeopleespeciallymanagersareexpectedtogoseewiththeir
owneyesratherthansitbehinddesksorbelievethatthetruthcanbelearnedonly
fromreportsornumbers.Itisrelatedtoappreciatingtheimportanceofgemba
goingtothephysicalfrontlineplaceofvalueworkwherethehandsonvalue
workersare.10
Goal
Product
Develop- ment
14 Principles
Foundation
Respect for People

LeanFoundation:LeanThinkingManagerTeachers
MichikazuTanaka,astudentofTaiichiOhno,summarizedthelessonshelearned:
Youcantcomeupwithusefulkaizen[improvement]sittingatyourdesk...We
havetoomanypeoplethesedayswhodontunderstandtheworkplace...They
thinkalot,buttheydontsee.Iurgeyoutomakeaspecialefforttoseewhats
happeningintheworkplace.Thatswherethefactsare.[SF09]
Wealsolearnedthatpotentialexecutivemanagershaveworkedtheirwayup
throughyearsofhandsonleanthinkingpracticeandmentoringtoothers.When
EijiToyodawaspresident,hesaidtothemanagementteam,Iwantyouactively
totrainyourpeopleonhowtothinkforthemselves[Hino06].Notethatthisis
notsimplyamessageofletpeoplethinkforthemselves.Rather,themanagement
cultureismanagersactasteachersofthinkingskills.Toyotamanagersare
educatedinleanthinking,continuousimprovement,rootcauseanalysis,the
statisticsofvariability,andsystemsthinkingandcoachothersinthesethinking
tools.
Fromthis,wecameespeciallytoappreciatethatforsuccessfuladoptionoflean,
therearemanagementqualitiesneededforanymeaningful,sustainedsuccessthe
leadershipteamcannotphoneintheirleansupport.Toyotaisoneoffew
companiesthatseemstodemonstratethesequalities;tosummarize[OST08]:
Longtermphilosophymanyinthecompanyareeducatedinlean
thinkingthroughcoursesandmentoringfrommanagerteachers.
Longtermphilosophyvirtuallyallmanagement,includingthe
executivelevel,musthaveasolidunderstandingofleanprinciples,havelived
themforyears,andteachthemtoothers.
Longtermphilosophymanagerteachershavecultivatedsystems
thinkingandprocessimprovementproblemsolvingthinkingskills,andtheyteach
ittoothers.Thecultureisimbuedwiththementalityandbehavior,Letsstopand
understandtherootcausesofproblems.Managerteacherstheinternalmotto
isGoodThinking,GoodProducts.Howdotheyachievethisgoodthinking
whichformsthefoundationoftheirsuccess?Itisthroughacultureof
mentoring.Managersareexpectedtobehandsonmastersoftheirdomainofwork
(thesayingis,mymanagercandomyjobbetterthanme),areexpectedto
understandleanthinking,andareexpectedtospendtimeteachingandcoaching
others.WelearnedduringaninterviewinJapanthatToyotaHRpoliciesinclude
analysisofhowmuchtimeamanagerspendsteaching.Inshort,managersareless
directorsandmore
11
LeanPrimer
teachersintheprinciplesofleanthinking,stopandfixright,andkaizen
mentality.Inthisway,theToyotaDNAispropagated[LH08].
AtsushiNiimi,ToyotaNorthAmericapresident,saidthatthegreatestchallengein
teachingtheToyotaWaytoforeignmanagerswas,Theywanttobemanagers,
notteachers.
In[Liker03],amatrixofmanagementculturesispresented;idealleanmanager
teachersareinthetopleftquadrantbottomupconsensusbuildersandreal
teamleaderswhoareworkexperts,andwhomentortheirteammembers:
expertknowledgeofthework
onlygeneralmanagement
bottomup
coach/mentor;builderofalearning
organization
facilitator
topdown
detailedtaskmaster
bureaucrat
Themoreonelearnsaboutlean,themoreoneappreciatesthatthefoundationis
managerteacherswholiveandteachitandhavelonghandsonexperience.The
foundationisnottoolsorwastereduction.
Anyexecutiveteamthatwantstosucceedwithleanthinkingwillneedtopay
attentiontothisbasiclessonthattheycannotphoneintheirsupporttodo
lean.
PILLAR ONE: RESPECT FOR PEOPLE

Respectforpeoplesoundsnebulous,butincludesconcreteactionsandculture
withinToyota.Theybroadlyreflectrespectforandsensitivitytomorale,not
makingpeopledowastefulwork,realteamwork,mentoringtodevelopskillful
people,humanizingtheworkandenvironment,safeandcleanenvironment(inside
andoutsideofToyota),andphilosophicalintegrityamongthemanagementteam.
Figure1.2illustratessomeimplications.
Goal
Product
Development
14
Principle
s
Foundation
12
Respect for People

Figure 1.2 respect for people

PillarOne:RespectforPeople
Don_t Trouble Your _Customer_

- your customer is anyone who consumes your work or decisions
- relentlessly analyze and change to stop troubling them
- don_t force people to do wasteful work - don_t give them defects- don_t make
them wait- don_t impose wishful thinking on them - don_t overload them
Teams & Individuals Evolve Their Own Practices & Improvements
- management challenges people to change and may ask what to improve , but...
- workers learn problem solving and reflection skills and then...
- decide how to improve
Develop People and Then Build Products
- managers act as teachers, not directors
- mentor people closely, for years, in engineering and problem solving
- teach people to analyze root causes and make problems visible; then they
discover how to improve
Lean Respect for People

ManagersWalk the Talk managers understand and
act on the goal of eliminating waste and continuous improvement in their own
actions and decisionsand employees see this
Develop Teams
- real, jelled teams of 5-6 people- team-work, not group-work, culture
Build Partners
- form long relationships based on trust- help partners improve and stay profitable
13
LeanPrimer
PILLAR TWO: CONTINUOUS IMPROVEMENT

Continuousimprovementisbasedonseveralideas:
GoSee
kaizen
perfectionchallenge
worktowardflow(coveredinthe14Principles)Go See for Yourself
(Go See) Gotothesource[theplaceofrealvalueworkgemba]tofindthefacts
tomakecorrectdecisions,buildconsensus,andachievegoalsatourbestspeed.
[Toyota01]GoSeeisaprinciplenotfoundinmanymanagementcultures.This
principleisdescribedascriticalandfundamental.IntheinternalToyotaWay2001
itishighlightedasthefirstfactorforsuccessincontinuousimprovement.Go
SeeshowsuprepeatedlyinToyotamanagerquotes,inToyotacultureandhabits
[LH08],ineducationontheToyotaWay,andintheresearchdonebyJapanese
analystsofleanthinking(forexample,[OST08]).Allthatsaid,itismissingfrom
somederivativeleandescriptionsandsounfortunatelysomeareunawareof
itsvitalrole.Inaleanthinkingculture,allpeople,butespeciallymanagers
includingseniormanagersshouldnotspendalltheirtimeinseparateofficesor
meetingrooms,receivinginformationviareports,computers,management
reportingtools,andstatusmeetings.Rather,toknowwhatisgoingonandhelp
improve(byeliminatingthedistortionthatcomesfromindirectinformation),
managementshouldfrequentlygototheplaceofrealworkandseeand
understandforthemselves.Thisrealfrontlineplaceofwork(gemba)doesnot
meanproximitytothebuildingwhereworkhappens,nordoesitmeangoingto
visitothermanagers.Itimpliestobeasphysicallyclosetotherealfrontlinework
aspossiblenotsittinginanofficenearby,butbreathingthesameair.Work
inleandoesnotprimarilymeantheoverheadorsecondaryworkofaccountingand
soon,butthevalueaddingworkthatthecustomercaresaboutengineering,
designingacar,producingthings,deliveringcustomerservice.AnexampleofGo
Seeisformanagerstoregularlyvisitandthensitwithhandsonengineersor
servicedeliverypeoplewhiletheyareworking,withtheaimofunder14
Goal
Product
Development
14
Principle
s
Foundation
Respect for People

PillarTwo:ContinuousImprovement
standingproblemsandopportunitiestoimprove.Itissimilartotheunfortunately
nowlostHPpracticeofmanagementbywalkingaround.
Inaninterview,ToyotaschiefengineerquotedTaiichiOhno,whoinsistedon
managerspracticingGoSeeatgemba:
Dontlookwithyoureyes,lookwithyourfeet...peoplewhoonlylookatthenum
bersaretheworstofall.[Hayashi08]
TheJapanesetermforGoSee,genchigenbutsu,hasalsobeenbroadlyrendered
asimplyingsolveproblemsatthesourceinsteadofbehinddesks.GoSeenotonly
implieswalkingtothesourcetofindfactsanddecidewithdirectinsight;itmeans
onceyouaretheretobuildconsensusforgoalsandexperimentstochange.
ThefullimplicationofGoSeeisforpeopleespeciallymanagerstofrequently
spendtimeattherealplaceofvaluework,buildrelationshipsoftrustwiththe
peoplethere,andhelpthemfixthings.
Forexample,Figure1.3showsapictureofCraigsofficeinBangalore,Valtech
India:alittledeskphysicallyamonghandsonteams.Hehasspenttimesitting
withtherealworkerswhiletheywork,andattendingtheirkaizenevents.Inthis
way,gettingadirectunderstandingofwhatsworkingandwhatsnotandhow
tobetterhelp.
Figure 1.3 officeGo See attitude
15
LeanPrimer
Kaizen
Improveforimprovementssake,endlessly.
Kaizenissometimestranslatedassimplycontinuousimprovementbutthatcon
fusesitwiththebroaderleanpillarofcontinuousimprovementanddoesnot
capturethefullflavor.So,wewillstickwiththeJapaneseterm.9
Kaizenisbothapersonalmindsetandapractice.Asamindset,itsuggestsMy
workistodomyworkandtoimprovemyworkandcontinuouslyimprovefor
itsownsake.Moreformallyasapractice,kaizenimplies:
1.chooseandpracticetechniquestheteamhasagreedtotry,untiltheyarewell
understoodthatis,masterstandardizedwork
2.experimentuntilyoufindabetterway3.repeatforever
Step1Chooseandpracticetechniquestheteamhasagreedtotry,untilthey
arewellunderstood(masterstandardizedwork).Theideaisforagrouptofirst
find(hopefully)skillfulbaselinepracticesandlearntodothemwell.Peoplelearn
todo<X>inastandardizedway,withplentyofpractice,coaching,andgood
education.Steponeinkaizenimplieshavingpatiencethroughtheawkward
learningphaseandnotabandoningnewtechniquesquickly.Peopleneedavalid
baselinetoimproveagainst.AndinDemingsterminology,theyneedtobeableto
distinguishbetweencommoncauseandspecialcausevariability.
Thissteponepointofkaizenisthatapersonorteamcannotaccuratelyseeifthey
needtoimproveorchangeapracticeunlesstheyhavefirstmasteredthebasics,
understooditssubtlepoints,andcandoitwell.Haveyoueverseen,Oh,<X>
doesntworkcommentsthatwerebasedoninsufficientskill,practice,or
education?Thereisnopointinimprovingorrejectingbasedon
misunderstanding.
Inleanthinking,standardizedworkdoesnotmeanconformingtocentralized
standardsAgrossmisunderstandingofleanthinkingisthenotionthat
standardizedworkmeansconformancetocentrallydefinedstandards.Thisis
suchaprofoundmistakefromtheleanperspective,yetsoeasilymisunderstood,
thatthispointdeservesspecialemphasis.Rather,theideaisforateamtomastera
baselineagainstwhichimprovementexperimentscanbecompared.Thisbaseline
thestandardis
9.WeavoidJapanesetermsunlessnoEnglishtermworks.
16
createdbytheteamthemselves(notbyacentralizedgroup)andiseverevolving.
AsOhnosaid:
Itoldeveryonethattheywerentearningtheirpayiftheyleftthestandardized
workunchangedforawholemonth.Theideawastoletpeopleknowthatthey
wereresponsibleformakingcontinualimprovementsintheworkproceduresand
forincorporatingthoseimprovementsinthestandardizedwork.[SF09]
ShareratherthanenforcepracticesToreiterate,thestandardizedworkor
teamnormsshouldnotbemisconstruedtomeanafixedpracticetofollowuntil
notifiedotherwiseoracentralizedtopdownstandardfromacentralprocess
groupthatisforcedonpeopleideascontrarytotheleanpillarofcontinuous
improvement.Toyotapeoplepromoteyokotenspreadknowledgelaterallythat
mayevolveuniquelyindifferentlocations,likeagraftfromatree.Yokoten
meansliterallytounfoldoropenoutsideways.Spreadknowledgeimpliesa
culturethatemphasizeshorizontalknowledgesharing,butnotbeingforcedto
conformtocentralprocessespushedtopdown.10SomequotesfromToyota
people:
Ifwetrytosimplygeteveryonetothecurrentstandardyouaremissing
opportunitiestogetbetter.Youarenottakingintoaccounthowtimesare
changing.Therehastobelotsofflexibilityinallowingcreativityalongtheway...
Standardsarenotdevelopedandthencommunicatedfromheadquarterstoallthe
plants.Rigidstandardswillonlykillkaizen...Itisyokoteneverytimesharebest
practices....Wemustletindividualsfromplantsdecidewhattheywilldotofix
theirproblemsandclosegaps.Wecannothavesomeonefromcorporatesaying
youneedtodoX,Y,Z,becausethisiscompletelycontrarytoToyotaproblem
solving.[LH08]
Communitiesofpracticesomethingwerecommendarecreatedtospread
knowledgelaterally.
Steps2and3Small,incremental,relentlesschangeofanything.Kaizenisan
ongoingactivitybyallpeople(includingmanagers)torelentlesslyand
incrementallychangeandimprovepractices,usuallyinsmallexperiments,though
largescalesystemkaizenisalsoanoption.Almostnopractice,process,orexisting
policyissacredanythingcango.Challengeeverything,inthewordsof
ToyotaPresidentConvis.Also,akaizencultureisnotonewhereonlybig
improvementprojectsbyprocessexpertsareinitiated.Rather,eachteamdoesit
regularlythemselves.
LearnprocessimprovementbydoingKaizenimplies,byceaselessrepetitionand
mentoring,peoplelearnbythemselveshowtomakeproblemsvisible,analyze
their
10.Thereareexceptions,suchassafetyandaccountingstandards.
17
LeanPrimer
rootcauses,andimprovebyexperimenting.AndfailureofexperimentsisOK.
Theonlyfailureinkaizenistonotcontinuouslyexperiment.
KaneyoshiKusunoki,anotherstudentofTaiichiOhno,andexecutivevice
presidentatToyota,saidaboutkaizenandmanagementsupport:
AdefiningcharacteristicofthecorporatecultureatToyotaisthatmanagersdont
scoldyoufortakinginitiative,fortakingachanceandscrewingup.Rather,
theyllscoldyoufornottryingsomethingnew,fornottakingachance.Leaders
arenttheretojudge.Theyretheretoencouragepeople.ThatswhatIvealways
triedtodo.Trialanderroriswhatit'sallabout!
InKaizenbyMasaakiImai,heshares:
TheessenceofKaizenissimpleandstraightforward:Kaizenmeansimprovement.
Moreover,Kaizenmeansongoingimprovementinvolvingeveryone,including
bothmanagersandworkers.Thekaizenphilosophyassumesthatourwayoflife
beitourworkinglife,oursociallife,orourhomelifedeservestobeconstantly
improved.[Imai86]
KaizenreflectsthePlanDoCheckAct(PDCA)Shewhartimprovementcycle
(alsoknownastheDemingcycle)[Deming67].InfactmanypeoplewithinToyota
formallyknowPDCAandsometimesdescribewhattheyaredoingasendless
PDCA[LH08].
Kaizen Events
Kaizenmostoftenhappensduringrepeatingteamkaizenevents;aregularand
frequentcadenceofeventsisdesirable,suchasdailyorweekly.Broadly,a
kaizeneventincludesthesteps(1)analyzesomecurrentsituationuntilitiswell
understood,and(2)designexperimentsforimprovement.Duringthisanalysisand
design,focusonactivitiesrathersittingaroundatableandtalking.Trycreative
activitiesatwhiteboards,onflipcharts,andsoforth.
Bewaredeadkaizeneventsinwhichpeoplegothroughthemotions,buthave
burnedoutfromoveranalysisorlackofempowermentandengagement.Avoid
takingontoo
18
manyimprovementexperimentsatoncebettertofocusononethingwell,than
manythingspoorly.
Five Whys
FiveWhys(usuallywritten5Whys)isasimpleandwidelyusedtoolusedin
kaizen.Ithelpsdevelopproblemsolvingandrootcauseanalysisskills.Inresponse
toaproblemordefect,ateamconsiderswhy?atleastfivetimes. 11These
questionsmayhavemultipleandrelatedanswers,sosometeamscreatea5
Whysgraphofbranchinganswers(seeFigure1.4),oramorestructuredfishbone
(Ishikawa)diagram.
Theimportantpointof5Whysisnotthetechniqueorthenumber5,butthatitis
partofthestopandfixrootcauseproblemsolvingmindsetandculture
pervasiveatToyota.Peoplearetaughttobecomedeepproblemsolvers;tonot
livewithproblems,buttothinkthingsthroughdeeply.Thereisalsoaconnection
betweenGoSeeand5Whys:Itiseasyforpeopletoguesswrongorweakanswers
unlesstheyseethefactsattherealplaceoftheproblem.
Figure 1.4 5 Whys graphpeople changing teams too frequently
Value and Waste
Whattoimproveduringkaizen?Inleanthinkingtheanswerrequiresan
understandingofvalueandwaste.
11.Fiveisnotamagicnumber;itismeanttoimplydigdeep.
19
LeanPrimer
ValueThemomentsofactionorthoughtcreatingtheproductthatthe
customer12iswillingtopayfor.Inotherwords,valueisdefinedintheeyesofthe
externalcustomer.13Imagineacustomerwasobservingtheworkinyouroffice.
Atwhatmomentswouldtheybewillingtoreachintotheirpocket,pulloutmoney,
andgiveittoyou?
WasteAllothermomentsoractionsthatdonotaddvaluebutconsume
resources.Wastescomefromoverburdenedworkers,bottlenecks,waiting,
handoff,wishfulthinking,andinformationscatter,amongmanyothers.
Onekindofanalysisinleanthinkingistoestimateallwasteandvaluemoments
fromconcepttocash.14Fromsuchatimelineonecansumthevaluetimeand
leadtime(concepttocash),andthencalculate
valueratio=totalvaluetime/totalleadtime
Wehavedonemanytimelineswithproductdevelopmentgroupsandhavenot
seenavalueratioinadevelopmentorganizationhigherthan7percent.Inother
words,93percentormoreofthetimeindevelopmentwaswastetime.15
ImprovementbyBanishingWasteAfterhavingdefinedvalueandwaste,we
cometoanoteworthydifferenceinleanimprovement.Othersystemsfocuson
refiningexistingvalueactions;forexample,improvingskillindesign.Aworthy
goalnodoubt.
However,sincetherearetypicallyfewvalueaddingmomentsinthetimeline
maybe5percentthenimprovingthosedoesnotamounttomuch.Butwitha
mountainofwastetimeintheprocess,therearebigopportunitiestoimprovethe
valueratiobyeliminatingwaste.
Forexample,acommonwasteinproductdevelopmentisthewasteof
overproductioncreatingsolutionsorfeaturesnotreallywantedbythecustomer.
Itmakeslittlesensetofocusonmeasuringandimprovingengineeringefficiency
by2percentifthereisamountainofunusedfeaturewasteduetopoordecisions
inproductmanagement.
Asanotherexample,oneofthewastesiswaitingordelaycustomersdonotpay
forthat.Haveyoueverseenthewasteofwaiting...
12.Valueintheeyesofthecustomerpositsanidealizedcustomer.13.Therearesome
quasileandescriptionsthatintroducetheideaofinternalbusinessvalue.Thisisnotpart
ofleanthinking,anditsapplicationcanleadtoadistortionof
improvementbecausethingsthatarewastecanbemislabeledasvalue.14.Thisispartof
theleanpracticevaluestreammapping[RS99].15.Thisisconsistentwithobservationby
others,suchas[Ward06]whoestimatesan
20
average5%valueratioinproductdevelopment.
forclarification?
forapproval?
foranotherteamtofinishtheirpart?NonValueAddingAction
CategoriesWithinToyotapeopleareeducatedtodevelopeyesforwaste.Asa
learningaid,listsofnonvalueadding(NVA)actionshavebeencreated.Thereis
notonecorrectlistthepointisnotthecategories,buttolearntoseeandbanish
wastefromthecustomerperspective.ThefollowingproductdevelopmentNVA
actioncategoriesaredrawnfromTheToyotaWay,ImplementingLeanSoftware
Development,andLeanProductandProcessDevelopment.
NonValueAddingAction
ExampleorComment
featuresorservicesthecustomerdoesnt
reallywant
1.Overproductionofsolutionsor
features,orofelementsaheadofthenext largeengineeringdocuments,moredetailed
step;duplication
designsthancanbequicklyimplemented
duplicationofdata
2.Waiting,delay
...forclarification,documents,approval,
components,othergroupstofinishsomething
3.Handoff,conveyance,moving
givingaspecificationfromananalysttoan
engineergivingacomponenttoanother
groupfortesting
4.Extraprocessing(includesextra
processes),relearning,reinvention
forcedconformancetocentralizedprocess
checklistsofqualitytasks
recreatingsomethingmade
5.Partiallydonework,workinprogress designsdocumentedbutnotbuiltthings
(WIP)ordesigninprogress(DIP)
builtbutnotintegratedortested
6.Taskswitching,motionbetweentasks; interruptionmultitaskingon3projects
interruptbasedmultitasking
partialallocationofapersontomanyprojects
7.Defects,testingandcorrectionafter
creationoftheproduct
testingandcorrectionattheendtofindand
removedefectsisnotavalueaction;itmay
beatemporarilynecessarywaste
21
LeanPrimer
NonValueAddingAction
ExampleorComment
peopleonlyworkingtosinglespecialityjobtitle,or...?
8.Underrealizingpeoplespotentialand
variedskill,insight,ideas,suggestions dopeoplehavethechancetochangewhattheyseeis
wasteful?
informationspreadacrossmanyseparatedocuments
9.Knowledgeandinformationscatteror
communicationbarrierssuchaswallsbetweenpeople,or
loss
peopleinmultiplelocations
10.Wishfulthinking(forexample,that Theestimatecannotincrease;theeffortestimateiswhatwe
plans,estimates,andspecificationsare wantittobe,notwhatitisnowproposed.
correct)
Werebehindschedule,butwellmakeituplater.
ImprovingthroughRemovingNVAsThefocusondeliveringvaluethroughwaste
reductionorientsaleanorganizationtowardfollowingthebatonratherthanthe
runners.Noticethattheimprovementstrategyissubtractiveratherthanadditive.
Ratherthan(forexample),Whatcanwegettheworkerstodotoincrease
utilization?,thequestionisWhatcanweremoveorstopdoing?Inour
consultingwehavefoundthistobeamindsetchangefortraditionalquality
assurancepeopleinlargeorganizationswhofocusonconformancetochecklists
andaddingactivitiesforimprovement.
TemporarilyNecessaryWasteversusPureWasteNoteverywastebattlecan
bewongivencurrentcapabilitiesandconstraints.Forexample,itiswickedlyhard
orvirtuallyimpossibletocreateaproductthatneverhadadefecttobeginwith.
Plustherearemanycaseswhereitischeapertoresolvedefectsthroughfeedback
loopswithtestattheendinsmallbatchesandshortcycles,especiallyasmodern
testingtoolsandtechniquesreducethecostandcycletimeofatest.Tobeclear:
Thisisnotarecommendationtowaitandonlytestattheendofdevelopment.
However,manyshortandcheapcyclesofsmallbatcheswithautomatedtesting
maynotalwaysbethecheapestsolutiontothebuildqualityinproblem.
Thusitissometimesprudentornecessary,giventodayscapabilities,totestand
correctaftercreationofasmalliteminaveryshortcyclethewasteofdefects.
EvenToyotadoesthiswastestep,butonlyinshortcycleswithsmallbatchsizes
sothatdefectsdonotlinger,replicate,orpileup.
Becauseofthis,Toyotarecognizestwotypesofwaste:
1.temporarilynecessarywaste...afuturebattle;forexample,testingattheend
ofashortcycle
2.purewaste...inprinciplecanandshouldbeeliminatednow
22
IsInventoryAlwaysPureWaste?Acommonviewamongthosenewtolean
thinkingisthatinventoryispurewasteandshouldalwaysbeeliminated.
InventoriesofphysicalthingsorofintangibleWIPsuchasrequirement
specificationsimplyinvestmentwithoutprofitandhiddendefects.Thatsnot
good.However,acommonpracticeinleanimprovementistocreatelevelpull,
removingvariability(oneofthesourcesofwaste)inadownstreamprocessstepby
insertingasmallbufferofhighqualityequallysizedinventoryitemsbeforethat
downstreamstep.
Figure 1.5 three sources of waste
Variability
varying cycle lengths, varying batch sizes of work packages, varying size of one
work package, varying team members or size, varying delivery times, defects
(these introduce much variability), interruption to handle hot defects, irregular
arrival of requests
Resolution?- leveling the work
- cadence; for example, timeboxed 2-week cycles
- decompose large work packages into many smaller ones, so that a more
consistent amount of work is taken each cycle
3 Sources of Waste
Overburden
- overtime for arbitrary deadlines
- one Product Manager having to know hundreds of features in detail
- often seen with specialist bottlenecks and over-dependence on superspecialists
Resolution?- develop eyes to see queues &
bottlenecks and those who are doing too much
- take on less work in cycle; descope- spread the work and skillcross-train
NVA actions
- for example, handoff, waiting, scattered information, partially done work, task
switching
Resolution?- kaizen events, to learn to see it and experiments to reduce
23
LeanPrimer
FocusonVariability,Overburden,andNVAActionsInadditiontoNVA
actions,intheToyotaWaypeoplearetaughtthreesourcesofwaste,illustrated
andcommentedwithresolutionideasinFigure1.5.16
Toyotapeoplewhoobserveoutsideattemptstoadoptleannoteacommonmis
educationaboutwastethemiseducationtoonlyfocusoneliminatingNVA
actions[LM06a].WithinToyota,allthreeweaknessesaregivenimportance,and
infactvariabilityandoverburdenareviewedasfrequentrootcausesthatgive
risetoNVAactions.Forexample,overburdenedworkerscreatemoredefects.
Perfection Challenge
Thisisthethirdelementofcontinuousimprovementinlean.
DuringavisittoToyotaweinvitedaretiredengineertodinnerinNagoya.After
severalroundsofsake,weasked,Whatdoyoumiss,nolongerworkingat
Toyota?Hereplied,Nolongerdiscussingperfectionwithpeople.
Wesometimesvisitanorganizationtodiscussleanadoptionandsomeoneobjects
withessentiallytheargument,Weremakinggoodmoney,andhaveestablished
processes.Whyshouldwechange?Wedonotthinkyouwouldhearthatquestion
inToyota.Theyarefarfromperfectandwearenotsuggestingsimplycopying
them,buttheircultureistohaveakaizenmindsettohavehighexpectationsand
tochallengeourselves,teammembers,andpartnerstolevelsofskill,mastery,
wastereduction,andvisionbeyondthestatusquo.
Thatspowerful.
No Final Process
In2001,ToyotacreatedaninternalToyotaWaybookletsummarizingthelean
principles.Onhearingtheproposedtitle,chairmanToyodasuggestedrenaming
thebookletToyotaWay2001.Why?Toemphasizethatthereisnofinalprocessin
Toyota(whichwouldstiflekaizen),butrather,continuousimprovementand
change.
Theimplicationofkaizenandspreadknowledgelaterallyisthatthereisnota
finalorcorrectdefinedprocesstofolloweverywherethatiscommunicatedfrom
acentralprocessgroup.Kaizendoesincludelearningandmasteringworking
agreements,butthey
16.ThewidelyusedJapanesetermsaremura(variability),muri(overburden),andmuda
(nonvalueaddactions).
24
14Principles
travelandevolvebythespreadknowledgelaterallymodel.Peoplewhohavethe
mindsetletsdefine(orbuy)thecentralprocess,writeitdown,andthenwe
shouldfocusonconformancetoitwillnotbecomfortablewithleanthinking.To
quotetheToyotaCEO,TherootoftheToyotaWayistobedissatisfiedwiththe
statusquo;youhavetoaskconstantly,Whyarewedoingthis?InToyotaandin
leanthinking,theideaistorepeatcyclesofimprovementexperimentsforever.
14 PRINCIPLES
Thetwopillars,respectforpeopleandcontinuousimprovement,arenotthe
entirepictureliterallyorfiguratively.Thereareotherpotentleanprinciplesthat
formtheoverallsystemoflean,someofwhichrecapitulateelementsinthetwo
pillars.
ToquoteFujioCho,chairmanofToyota:
ManygoodAmericancompanieshaverespectforindi
viduals,andpracticekaizenandother[Toyota]tools.Butwhatisimportantis
havingalltheelementstogetherasasystem.Itmustbe
practicedeverydayinaveryconsistentmanner.[Liker04]
Partofthisbroadersystemiscoveredinthe14principlesdescribedintheToyota
Waybookthatcomesoutofdecadesofdirectobservationandinterviewswith
Toyotapeople.Table1.1summarizestheprinciples,someofwhicharefurther
discussedafterthetable.
Goal
Product
Development
14
Principle
s
Foundation
Table 1.1 14 principles
Principle
Comment/Reference
1.Basemanagementdecisionsona
longtermphilosophy,evenatthe
seelocaloptimizationp.32
expenseofshorttermfinancialgoals.
2.Movetowardflow;movetoever
smallerbatchsizesandcycletimesto
delivervaluefast&exposeweakness.
seep.27
3.Usepullsystems;decideaslateas
possible.
seep.30
25
Respect for People

LeanPrimer
Principle
Comment/Reference
4.Leveltheworkreducevariabilityand
seealsop.23
overburdentoremoveunevenness.
5.Buildacultureofstoppingandfixing
notonlyfix,butapply5Whysanalysistounderstand
problems;teacheveryoneto
therootcauses,andreallyfixit;seep.19
methodicallystudyproblems.
6.Masternorms(practices)toenable
kaizenandemployeeempowerment.
thesearechangeableworkingagreements,notrigid
organizationstandards;seep.16
7.Usesimplevisualmanagementto
revealproblemsandcoordinate.
seep.31
8.Useonlywelltestedtechnologythat
servesyourpeopleandprocess.
9.Growleadersfromwithinwho
leadersfromwithinmaynotbeagoodideaifyour
thoroughlyunderstandthework,livethe existingcultureisnotleanthepointiseducated
leanthinkingleaders;seep.10
philosophy,andteachittoothers.
10.Developexceptionalpeopleandteams thisreflectstheToyotabuild(leanthinking)people,
whofollowyourcompanysphilosophy. thenproductsmessage;itincludestowering
technicalcompetence
11.Respectyourextendednetworkof
bringpartnersintoleanthinkingaswell;thereisan
partnersbychallengingthemtogrowand
emphasisonsharingknowledgeandopenness
helpingthemimprove.
12.Goseeforyourselfattherealplace
ofworktoreallyunderstandthesituation seep.14
andhelp.
13.Makedecisionsslowlybyconsensus,
thoroughlyconsideringoptions;
activitiessuchaskaizeneventssupportthis
implementrapidly.
14.Becomeandsustainalearning
organizationthroughrelentlessreflection seep.16
andkaizen.
26
14Principles
Flow
Flowsuggestsmakingvalueflowwithoutdelaytothecustomer.Asacounter
example,acustomerrequestwaitsinaqueuewaitingtobeapproved,analyzed,
implemented,reworked,ortested.Thatisnotflow.Rather,asvalueiscreated
inproducts,software,information,decisions,serviceitflowsimmediatelytothe
customer.Itisrelatedtothefollowthebatonmetaphorandtothegoaloffaster
concepttocash.Flowisaperfectionchallenge;zerowasteinthesystemand
immediatecontinuousflowingdeliveryofvalueareprofoundchallenges,probably
neverachieved.Thejourneyisusuallymovingtowardflow.
Intheleanhousediagram(Figure1.1),flowisincludedinboththe14principles
andinthekeyelementsofcontinuousimprovement.Why?Becausetomove
towardflowitisnecessarytoreducebatchsize,cycletime,delay,WIP,andother
wastes.Andthishasthebeneficialsideeffectofrevealingmoreweaknessesand
waste,providingnewopportunitiesforcontinuousimprovement.Thisisan
importantbutsubtlepoint,expandedinthenextsection.
Movingtowardflowisassociatedwithappliedqueueingtheory,pullsystems,and
more.Byunderstandingthese,peoplecanmovethesystemtowardflowby
smallerworkpackagesizes,smallerqueuesizes,andreductioninvariability.
Indirect Benefits of Reducing Batch Size and Cycle Time
Whyworkinsmallbatchsizesandwithmanysmallcycles?Doesntthatincrease
youroverheadbecauseofthetransactioncostassociatedwitheachcycle?People
askingthisquestionmaynotyetappreciatetheadvantagesofsmallbatchesin
shortcycles:
Theoveralllargerreleasecycletimereductionthatcancomeby
eradicatingqueuesandbyapplyingqueuemanagementsothatmanycyclesare
shorter.
Theeliminationofbatchdelay,whereonepartofasolutionis
unnecessarilyheldbackbecauseitismovingthroughthesystemattachedtoa
largerbatchofothersolutions.Eliminatingthisprovidesanotherdegreeof
freedomforthebusinesstoshipasmallerproductearlierwiththehighest
prioritysolutions.
Andlastbutnotleast,thereareindirectbenefitsduetothelakeand
rockseffectdescribednext.
27
LeanPrimer
Indirect Benefits: The Lake and Rocks Metaphor
Ametaphorsharedinleaneducation:lakeandrocks.Thedepthofthewatermay
representtheinventorylevel,batchsize,orcycletime.Whenthewaterishigh
(largebatchorinventorysize,orlongcycletime),manyrocksarehidden.These
rocksrepresentweaknesses.Forexample,consideraneighteenmonth
sequentialreleasecyclewithamassivebatchtransfer;inefficienttesting,
integration,andpoorcollaborationareallhiddenbelowthesurfaceofsuchalong
cycleandsuchalargebatch.Butifweworkwiththatgroupandsolutionsthatis
potentiallydeliverableintwo
ask,Pleasedeliverasmallsetofweeks,everytwoweeks,thensuddenlyallthe
ineffectivepracticesbecomepainfullyobvious.
Saidanotherway,thetransactioncost(overheadcost)oftheoldprocesscycle
becomesunacceptable.Thatpainthenbecomesaforceforimprovement,because
peoplecannotstandreexperiencingiteachshortcycle,andindeeditmaysimply
beimpossibletodothegoalsofthecyclewiththeoldinefficientpractices.
ThisdynamichasbeencentraltoToyotascontinualimprovementapproach.
Tip:Notallrocksarebigorimmediatelyvisible.Theleanjourneyistostart
withthebigrocksthataremostpainfullyobviousyetmovable,andovertime
workonsmallerimpediments.
ThecausalloopdiagraminFigure1.6illustratesthislakeandrockseffectinterms
ofasystemdynamicsmodel.
28
14Principles
Figure 1.6 indirect and delayed benefits of reducing batch and cycle size
smaller batch size leads, on average, to smaller queue size

noticeably delayed positive effect ... as batch size goes down and the group sees
1 the inefficient overhead, they may
improve and thus over time start to drive the overhead down
this is a key, and perhaps counterintuitive, relationship not first appreciated in lean
development and queue managementto sustainably work in small batches and short
cycles, there arises strong pressure to constantly improve or revolutionize; this leads to
driving down transaction costs
however, there is a delay in this long-term improvement, and the short-term effect is the
oppositeincreasing overhead as batch size becomes smaller
in the long term, for example, people cannot stand inefficient testing in this contextthey
will move to smarter (automated?) test, but that takes time
batch size (work package size)

queue size
cycle time
O
__ $$ (profit)
O
long term
feedback time
O
quality innovation
short term
transaction costs (overhead)

O
efficiency
this is the lake and rocks effect
other key, but not immediately appreciated, opposite reinforcement impacts of reduced
feedback time...- short feedback loops quickly improve quality- after some delay, the
increased innovation
opportunities are exploited and can pay off
lower cycle time leads to higher profits (often); this is an opposite (O) effect
some product groups are unaware that shorter cycle time can have a direct impact on
profit, in addition to the
indirect benefits shown in this model 54
29
O
LeanPrimer
Pull Systems
Pullversuspush.Consideraprocessformanufacturingandstoringlaptop
computers.Inapurepullsystem17nolaptopisbuiltorstoredininventoryuntil
thereisacustomerorder.Zeroinventory18isagoal,andworkisdoneonlyin
responsetoapullsignalfromthecustomer.Thatisthekeymeaningofpull:
Buildinresponsetoasignalfromthecustomer,andotherwiserestorimprove.
Pullexamples?Printingjustthetwentybookorderorpreparingjustonerestaurant
dish.
Butapullsystemgoesdeeperthanthatthecustomerisnotjustthefinal
customer.Rather,inamultistageprocesswithanupstreamteamdoingpartial
workbeforeadownstreamteam,adownstreamteamisthecustomertotheir
upstreamteam.Inapurepullsystemtheupstreamteamdoesnotcreateanything
unlesspulledfromdownstreamrequest.
Ontheotherhand,inapushsystem,onespeculativelybuildsandstoreslaptopsin
thehopeoforders,andthentriestopushthemtocustomers.Inamultistage
process,upstreamteamscreateaninventoryofpartiallydoneworkfor
downstreamteams.Anykindofspeculativeinventorypizzas,bigdetailedplans,
books,designsformanyfeatureswhosevalueisuncertainarerelatedtopush
systems.
Resourcemanagementstrategiesthatfocusonhighutilizationofworkersa
focusonwatchtherunnersratherthanwatchthebatoncreateanenvironmentin
whichpeoplewillcreatealargeinventoryofthings(analysisdocu
ments,designs,...)inapushmodel.
ExposedefectsIfyouonlycreateonethinginresponsetopullfroma
customerrequest(inthiscontext,yourcustomerisanyonedownstream)andthe
customerconsumesitquickly,anydefectsinthatonethingcreatedeitherby
accidentordesignarequicklydiscovered.Thatcanleadtofurthersystemic
improvementifpeoplehavestopandfixmindset.Ontheotherhand,inpush
systems,defectsarehiddeninanunconsumedinventory(ofdocuments,...).For
example,pushingalargebatchofdesigndecisionswilldelaythediscoveryof
misunderstandingsorproblems,becauseitisalongtimebeforetheyare
implementedandevaluatedbyacustomer.
17.PullisrelatedtoaJustinTimesystemJITimplementspull.18.Inpullsystemsfor
development,loworzeroinventorymeanslessinventoryof
30
detailedspecifications,plans,untesteddesigns,andsoon.
14Principles
DecideaslateaspossibleInpullsystems,youdonotdecideearly,quitethe
oppositeyoudecideaslateaspossibleandcommitatthelast
responsiblemoment[Smith07].Inthisway,youhavethemostinformationto
makeaninformeddecision.Youdonotwasteresourcesmakingunnecessary
inventoryorearlydecisionsthatwillhavetooratleastshouldchangein
responsetodiscovery.
SmallbatchescanleadtoradicalimprovementAsexploredintheIndirect
BenefitsofReducingBatchSizeandCycleTimesectiononpage27.
Thus,inseveralways,pullsystemssupportmovingtowardsflow.
AvoidafalsedichotomyTocategoricallystatethatpullisgoodandpushisbad
wouldbeafalsedichotomy.Usuallybecauseofhardconstraints(forexample,the
speedoftransportation),someinventoryandsomepushmaybeusefula
temporarilynecessarywaste.Toyotadealerships(outsideofJapan)holdsome
inventoryofvehiclesbecauseforeigncustomerswanttosee,buy,andleavewitha
carimmediately.
Stop and Fix
Toyotapeoplearecoachedbymanagerteacherstotakethetimetopausewhen
defectsorproblemsarise.Ratherthancreatingonlyaquickfixresponse(orno
response),ateamwillholdakaizeneventtograsptherootcauses,andthen
initiatestepstowardadeepsolutiononethatideallypreventsthedefector
weaknessfrombeingpossibleandthusbuildingqualityin.
Forexample,Toyotaisfamousfortheirstopthelinepracticeinwhichanyone
canpullacordwhentheyseeadefect,tostopallworkontheline.Thisisstepone
inasystematicresponsetowardbuildingqualityin.Anotherexample:Toyota
encourageshumanfriendlymanufacturingdevicesthatthemselvesdetectafailure,
automaticallystop,andalertpeopletotheproblem.ThiswasinspiredbySakichi
Toyodawhomadehisoriginalfortunebydesigningaweavingloomthat
automaticallydetectedafailureandthenstopped[Hino06].Thisisthelean
practiceofjidoka.19
Simple Visual Management
ToyotaemphasizessimpleandBIGvisualtoolstosignalproblems,communicate,
andcoordinateapullsystem.Therearebigdisplaysonwalls,brightandbig
physicalcolor
19.JidokaisdifficulttorenameinEnglish;itissometimesdescribedasautomationwith
ahumantouch.
31
LeanPrimer
codedcardsthatpeoplecantouchandmove,andsoforth.Keythemesareeaseof
viewingfromadistance,physicaltokens(suchascards),color,andsimplicity.
Thisistheoppositeofdisplayingmanylittleordetailedelementsofinformation
onsmallcomputerdisplaysfromsoftwarebasedsystems;however,acomputer
displaythatissimplyfilledwithablobofredcolortoshowabrokenbuildisin
thespiritofvisualmanagement.
Theseinformationradiatorsforvisualmanagementareapplicabletoproduct
development,servicedelivery,oranydomaintomakeinformationeasily
accessible.
Akanban(kanvisualsignal,bancardorboard)isusedintosignalapull
event(areplenishmentrequest)inapullsystem.Theclassicexampleisastore
withsomethingforsaleonashelf,suchasonepie.Behindthepieontheshelfis
anorangecardlabeledonepiethewithdrawkanban(card).Whenthepieis
eventuallytakenofftheshelfbyacustomer,thewithdrawkanbanisrevealedand
takentothebakerytogetanotherpietorefilltheshelf.Thisispossiblebecause
thereisonefinishedpieininventoryinthebakerywaitingforthisevent.
Alsoatthistime,acreationkanbanissenttothebakertostartingbakingone
morepie.Asinglepieispulledontotheshelfbythewithdrawkanban,ratherthan
piesbeingpushed.
Anerrordisplay(andon)isavisualaidinToyotatosignaldefectsinthings.
SelfdirectedworkThisisathemefoundineffectiveteamresearch.Noticethat
visualmanagementsupportsselfdirectedworkbecausepeoplecaneasilyseewhat
isgoingon,tocoordinate.Also,theworkofakanbancardisselfexplanatory,
suchasonepieorchangestyleofwebpage.
Visual Management for Queues in Knowledge Work
Queuesofphysicalthingsareeasyforpeopletoperceive,andtoperceiveasa
problem...Mygoodness,theresagiganticpileofStuffqueuingupoverthere!
Makinganymoneyfromthepile?Aretheredefectsinthere?Doesitneedtobe
combinedwithotherstuffbeforewecanshipit?Doweneedandwillwemake
moneywitheachandeveryiteminthepile?
Butwhataboutqueuesinknowledgework?
32
14Principles
InvisiblequeuesInmanyknowledgeworkdomains(andsomeservice
domains)therearealsoqueues,butbecausetheyareinvisible(usually,asbitsona
computerdisk)theyarenotseenasqueuesorkeenlyfeltasproblems.Abusiness
personwhohasinvestedtenmillioneurostocreateagiganticpileofpartially
doneStuffsittingonthefloorcanseeitandwillfeelthepainandurgencytogetit
moving.Butknowledgeworkerspeopledonotreallyseeandfeelthepainoftheir
queues.
Yet,theyarethere.QueuesofwastefulWIPordesigninprocess(DIP)
information,documents,andbitsonadisk.Invisiblequeues.PeopleinToyota
learneyesforwaste.Theylearntoseethingsaswastethattheyhadnot
considered,suchasinventoryqueuesofstuff.Similarly,knowledgeworkers
needalessonineyesforqueuessothattheycanstarttoperceivewhatisgoing
on,anddevelopasenseofurgencyaboutreducingqueuesizes.
Figure 1.7 lean visual management creates physical tokens, such as task cards on a
task board and paper charts on a wall, so that invisible queues can become tangible
really seen and felt
PhysicaltokenstoseequeuesTodevelopeyesforqueuesinanydomain
(service,engineering,...)andasenseofurgentattentiontothequeuesandWIP,
applyvisualmanagementwithphysicaltokens,suchascardsonawall.Why
physical?Puttingthesetasksintotodayscomputersdefeatsthepurposebecause
thesequeuesneedtobeeasilyandnoticeablyvisibleatalltimes,andtheyneedto
bebig.Storageintodayscomputers(forexample,inaspreadsheetlist)makes
themsmall,andnotalwaysvisible.Andhumanswithcountlesseonsof
evolutionaryinstinctworkingwithconcretethingsneedtoseeandfeeltangible
queues20.
33
LeanPrimer
VisualmanagementtoseeandlimitWIPOneoftheleanwastesisWIP;as
withqueues,thisishardtoperceiveinknowledgeorserviceworkbecauseitis
oftenintangibleworkwithrelatedartifactshiddeninsidecomputers(suchas
documents).ExperimentwithawallarealabelledWIPandplaceworkcardsin
thatarea.PeopleorgroupscanestablishpoliciestolimittheWIP,suchas,no
morethan2itemsofWIP.Thevisualizationaidsthepolicy.
LEAN PRODUCT DEVELOPMENT

Thetwopillarsand14principlesarecoretoleanthinking.However,thereare
otherprinciplesandpracticestooutlearnthecompetition,specifictolean
productdevelopment.
Toyotapeopleexecutetwokeyprocesseswell,(1)productdevelopmentand(2)
production.UniversityofMichiganresearchersdidathreeyearstudyofToyota
andNorthAmericancompaniesproductdevelopmenteffectiveness[LM06b].
Results?...
Forexample,theaveragedie21designtocompletedurationwasfivemonthsfor
Toyotaengineersandtwelvemonthsforthecompetition.Allthis,while
maintainingthelowestdevelopmenttosalesratioofanymajorautomotive
companyintheworld,duetotheeffectivenessoftheirdevelopmentpractices.
Howdotheydoit?Whatisafocusofleanproductdevelopment?Answer:
Outlearnthecompetition22
20.Physicaltokensareacriticalaspectofleanvisualmanagementthatisnotalways
appreciated.Somepeoplecreatesoftwaresystemsforvisualmanagementandmissthe
purposeofthevisceral,tangibledynamicofusingphysicaltokens.Someday,displays
willbewallsizeandonewillmovecomputerobjectswithphysicalgestures,
stimulatingthisvisceralresponse;thattechnologywillthennegatethispoint.
21.Adieisatemplateforstampingormoldingmetalorplasticparts.22.Coinedby
ToyotaproductdevelopmentresearcherDr.AllenWard.
34

Goal
Product
Development
14
Principles
Foundation
Respect for People

LeanProductDevelopment
WhenToyotadevelopedthehybridPrius,whatdidtheycreate?
thedesignofthecar(andimplementationofembeddedsoftware);in
developmenttheyhaveaknowledgevaluestreamtocreateaprofitableproduction
valuestream
knowledgeorinformationaboutcustomers,alternatives,...Lean
productdevelopment(LPD)focusesoncreatingmoreusefulknowledgeandlearn
ingbetterthanthecompetition.Also,leveragingthatknowledgeandnotwasting
thefruitsoftheeffortbyforgettingwhathasbeenlearned.Figure1.8andFigure
1.9illustratesomeoftheleanpracticestooutlearnthecompetitioninLPD;
followupsectionselaborateafewitems.More-Valuable, Lower-Cost Learning
Notallnewknowledgeorinformationisvaluable;theidealistocreate
economicallyusefulnewinformation[Reinertsen97].Thisischallengingbecause
itisadiscoveryprocessyouwinsome,youlosesome.Ageneralleanstrategy,
basedonasimpleinsightfrominformationtheory,istoincreasethevalueof
informationcreatedandlowerthecostofcreatingknowledge.Highervalue
informationSeveralideashelp.Forexample:
FocusonuncertainthingsChoosetoimplementandtestunclearor
riskythingsearly.Thevalueofthefeedbackishighpreciselybecausethe
outcomesarelesspredictablepredictablethingsdonotteachusmuch.
FocusonearlytestingandfeedbackInformationhasarealcostof
delay,whichisonereasonwhytestingonlyonceattheendofalongsequential
cyclemotivatedbythemisguidedlocaloptimizationofbelievingthatitwill
lowertestingcostsisalmostalwaysunskillful.Itcanbeverycostlytodiscover
duringstressperformancetesting,after18monthsofdevelopment,thatakey
architecturaldecisionwasflawed.Inleandevelopment,shortcycleswithearly
feedbackloopsarecritical;byimplementinglesspredictablethingsearlyandin
shortcyclesthatincludetesting,thecostofdelayisreduced. 23
23.Notethatreducingthecostofdelayofinformationinproductdevelopmentalmost
alwaysrequiresbuildingandtestingsomething.
35
LeanPrimer
LowercostinformationTheIndirectBenefitsofReducingBatchSizeand
CycleTimesectiononpage27examineshowadoptingleanprinciplesendsup
reducingtheoverheadcostofprocesses.Infact,onecanbroadlylookatthese
methodsassucceedingbyloweringthecostofchangecompetingonagilityor
flexibility.Andthatincludesloweringthecostoflearning.Forexample:
Focusonlargescaletestautomationtolearnaboutdefectsandbehavior.The
costoffrequentlyreexecutingautomatedtestsisusuallyinsignificantincompar
isontothevaluableearlyfeedback.
Focusonfrequentorcontinuousintegrationtolearnaboutdefectsandlackof
synchronization.Andbyintegratingfrequentlyinsmallbatches,teamswilldrive
downtheaverageoverheadcostbythelakeandrockseffect.
Focusonmentoringfromexpertsandspreadingknowledgetoreducethecost
ofrediscovery.
Cadence
Workinginregularrhythmsorcadenceisaleanprinciple,bothinproductionand
development[Ward06].Asteadyheartbeat.Inleanproduction,itiscalledtakt
time.24Indevelopment,itiscalledcadence.Cadenceisapowerfulprinciplein
leanproductdevelopment,sothesubjectisexaminedinsomedetail...
Thereissomethingbasicandveryhumanaboutcadence:Peopleappreciateor
wantrhythmsintheirlivesandworkandappreciateorwantritualswithinthese
rhythms[Kerth01].Mostofusworkinacadenceofsevendayweeks.Thereisthe
Tuesdaymorningweeklymeetingritual.Andsoon.Simply,cadenceatwork
improvespredictability,planning,andcoordinating.Atadeeperlevel,itreflects
therhythmsbywhichweliveourlives.
24.taktrhythmicbeat(German)
36
Figure 1.8 how to outlearn the competition
New Knowledge
- intensive customer investigation

- concurrent set-based development
Value of Info
- focus on uncertain things
- focus on lowering the cost of delayed info
Lean Product
Development Outlearn the Competition
Cost of Info
- test (etc.) automation - integrate frequently- ...
Learn from Feedback
- challenge everything process culture
- systematic, repeating reflection and improvement
Reuse Knowledge
- long mentoring from manager-teachers who are also master engineers
- record experiments in brief, standard format
- teach and require people to use the records
Data-Driven
- experiment, collect data, adapt based on data including management

- avoid wishful thinking and speculation of plans and specifications
37
Figure 1.9 LPD practices

LeanPrimer
Develop Long-Lasting Engineers with Highest Skill and Craftsmanship

- work as hands-on engineers for years; not encouraged toenter management
early
- mentored closely in engineering and deep problem-solving skills
Managers Who Are Master Engineers and Teachers
- a key role of _manager_ is teacher
- at Toyota, your boss can always do your job better than you
- apprenticeship model
Team Roomwith Visual Management
- chief engineer and others meet and work face-to-face in a large common room,
not separate offices; cross-functional members
- visual management: display engineering/ project data on walls
- see pictures in this chapter
Set-Based Concurrent Engineering
- generate many alternative designs in parallel
Cadence
- with short regularly-timed cycles, with small batches of work
Lean Product
Development Outlearn the Competition
Cross-Functional and Product Mindset
- people and teams emphasize cross- functional integration
- focus on product success over departmental or functional (e.g., test, design)
goals
Entrepreneurial Hands-on Chief - engineer responsible for technical and

business success
- an up-to-date great engineer with entrepreneurial spirit is given not only
technical control, but project and business control
- rather than a marketing or other non-engineering specialist
38
Cadence and Timeboxing

Onepopularapproachtoimprovecadenceistimeboxing,afixedandusually
shortcycletimeofdevelopmentwork(suchasatwoweektimebox).Teamsare
expectedtodeliverordemonstratesomethingattheendofthefixedduration
ideallysomethingsmallandwelldoneratherthanlargeandpartiallydone.The
durationmaynotchange,butthescopeofworkcanvarytofitthetimebox.
Timeboxingisnotapanaceaforallknowledgeworkproblems,butithas
advantages:
Timeboxingenforcescadence.
Developmentworkisoftenfuzzyunbounded(orweaklybounded)work.
WhentheteamknowsthatthetimeboxendsonMarch15,itboundsthefuzzy
workandincreasesfocus.So,timeboxinglimitsscopecreep,limitsgoldplating,
andincreasesfocus.
Timeboxingreducesanalysisparalysis.
SupposeyouareinuniversityandhaveanassignmentdueonMonday.
Whendoyoustart?Formany,theansweris,ClosetoMonday.Thisiscalled
StudentSyndrome[Goldratt97]andtimeboxingisacounterbalance.
Ifteamsmustdeliversomethingwelldoneinexactlytwoweeks,the
wasteandineffectivenessincurrentwaysofworkingbecomepainfullyclear.
Timeboxingcreatesachangeforcetoimprovethelakeandrocks
improvementeffect.
Timeboxingsimplifiesscheduling.
Humansareprobablymoresensitivetotimevariationthantoscope
variationItwaslateisrememberedmorestronglythan,IthadlessthanI
wanted.Timeboxingreducestheerosionofconfidencethathappenspeoplesay,
yetagain,...maybeinonemoreweekitwillallbedone.Re-use Information
or Knowledge Inadditiontothelongtermshifttowardacultureofmentoringby
masterengineersandmanagerteacherstoreuseinformation,asimplesharing
toolcanhelp.Inourcoachingwehaveseenapatternthatthemoststickyor
successfultoolisawiki.SimplicityandaWeb2.0centrichypertextmodel
seemstowinoutoverolderdocumentcentrictools.
39
LeanPrimer
Team Room with Visual Management
Leanproductdevelopmentencouragesateamroom(orbigroombigenough
forateam)withoutinternalpartitionsorwalls,whereacrossfunctionalteam
worksandmeets,andtheentrepreneurialchiefengineersits.Wallsarecovered
withlargephysicaldisplaysofprojectandengineeringinformation,tosupport
visualmanagement.Theteamroomisincontrasttopeopleworkinginseparate
officesorcubicles
withcommunicationbarrierssuchaspartitionsbetweentheteammembers.Fora
moredetaileddiscussion,seetheVisualManagementforQueuesinKnowledge
Worksectiononpage32.
Entrepreneurial Chief Engineer with Business Control
Therearetwokeydomainsinproductcreation:marketingandtechnical.Inmost
productorganizationsthatwevisit,theleadershipforthesedomainsinsplit.For
example,aproductmanagementgroupthatisresponsibleforthebusinessgoals
andfeatureselection,whosemembersarenotmasterengineers.Toyotadoes
thingsdifferently.Theycombinemarketingandtechnicalleadershipinonegreat
entrepreneurialchiefengineerwithtoweringtechnicalexcellencewhoisalso
attunedtoandresponsibleforthebusinesssuccessofthenewproduct,andwho
understandsthemarket.25
Set-Based Concurrent Engineering
Haveyouseendevelopmentasfollows?
1.pickorprototypeonesolutionordesign(oneuserinterface,onearchitecture,...)
2.evolveit3.deliver
25.Wehaveseensuccessfulproductswithproductmanagerswhoarenotmasterengi
neersthoughtheydoneedtobegreatproductmanagerswithdetailedknowledgeofthe
market,product,andexistingcustomers.
40
Setbasedconcurrentengineeringisalsocalledsetbaseddesign,andis
different.Forexample,ratherthanoneengineerorteamcreatingonecooling
systemdesign,severalalternativesmaybeexploredatToyotainparallelby
differentteamsandsotooforothercomponents.Thesesetsofalternativesare
exploredandcombined,andgraduallyfilteredincycles,convergingonasolution
fromwhatwasatfirstalargesetofalternatives,thenasmallerset,andsoon.
Theyoutlearnthecompetitionbyincreasingalternativesandcombinations.
Astepinthisdirectionistoexploreatleasttwoalternativefornontrivialdesign
elementsduringdesignworkshops.Forexample,ratherthanallgatheringaround
onewallofwhiteboardsanddoingonedesignasoneteam,splitintotwogroups
andworkattwogiantwhiteboardsatoppositeendsoftheteamroom.Every30
minutesorsovisiteachotherswalldesignsandshowandtellcollecting
ideas.
Can Lean Production Lessons Help Development?
Newproductdevelopment(NPD)orresearchanddevelopmentisnotpredictable
repetitiveproduction(manufacturing),andtheassumptiontheyaresimilarisone
causeofthemisuseofearly1900smanufacturingeconomiesofscale
managementpracticesindevelopment;forexample,sequentialdevelopmentand
bigbatchtransfersofspecifications.
Yet,someoftheprinciplesandideasappliedinleanproductionincludingshort
cycles,smallbatches,stopandfix,visualmanagement,andqueueingtheoryare
successfullyappliedinleanproductdevelopment.Why?Modernleanproduction
isdifferent,thesmallbatches,queues,andcycletimesinpartreflectqueueing
theoryinsight(amongothersourcesofinsight)adisciplinethatwascreatedfor
thevariablebehaviorinnetworksthatismuchmorelikeproductdevelopment
thantraditionalmanufacturing.
Anironyinsomeproductorganizationsisthatthemanufacturingengineershave
revolutionizedandadoptedleanproduction,movingawayfromeconomiesof
scaletowardflowandflexibilityinsmallbatcheswithoutwaste.Butthese
lessonswhichfitwelltoNPDremainunusedbydevelopmentmanagement,
whocontinuetoapplypracticesfoundinoldereconomiesofscalemanufacturing
management.
41
LeanPrimer
Allthatsaid,acaution:NPDisnotmanufacturing,andanalogiesbetweenthese
twodomainsarefragile.Unlikeproduction,NPDis(andmustbe)filledwith
discovery,change,anduncertainty.Somevariabilityisbothnormalanddesirable
innewproductdevelopment;otherwise,nothingnewisdone.Therefore,lean
thinkingincludesuniquepracticesforNPD.
CONCLUSION
Asyouinvestigateleanthinking,itiseasytoseethatitisabroadsystemthat
spansallgroupsandfunctionsoftheenterprise,includingproductdevelopment,
sales,production,service,andHR.Leanappliestotheenterprise.
Leanthinkingismuchmorethantoolssuchasvisualmanagementorqueue
management,ormerelyeliminationofwaste.AscanbeenseenatToyota,itisan
enterprisesystemrestingonthefoundationofmanagerteachersinleanthinking,
withthepillarsofrespectforpeopleandcontinuousimprovement.Itssuccessful
introductionwilltakeyearsandrequireswidespreadeducationandcoaching.To
requoteFujioCho,chairmanofToyota:
ManygoodAmericancompanieshaverespectforindividuals,andpracticekaizen
andother[lean]tools.Butwhatisimportantishavingalltheelementstogether
asasystem.Itmustbepracticedeverydayinaveryconsistentmanner...
ABOUT THE AUTHORS
CraigLarmanworksasamanagementconsultantfocusingonlargescaleprojects,
leanthinking,andmentalmodels.Heservedastheleandevelopmentcoachat
Xeroxforseveralyears.
BasVoddehasabackgroundinlargeembeddedsystemsproductcreation,and
leadingtheadoptionofagileandleanprinciplesandpracticesatNokiaNetworks.
Healsoworksasamanagementcoach,consultant,andasadevelopmentcoach.
42
RECOMMENDED READINGS
Dr.JeffreyLikersTheToyotaWayisathoroughcogentsummaryfrom
aresearcherwhohasspentdecadesstudyingToyotaandtheirprinciplesandprac
tices.
InsidetheMindofToyotabyProfessorSatoshiHino.Hinospentmany
yearsworkinginproductdevelopment,followedbyanacademiccareer.Hinohas
spentmorethan20yearsresearchingthesubjectofthisbook.Thisisadata
drivenbookthatlooksattheevolutionandprinciplesoftheoriginalleanthinking
managementsystem.
ExtremeToyotabyOsono,Shimizu,andTakeuchiisawellresearched
analysisoftheToyotaWayvalues,contradictions,andculture,basedonsixyears
ofresearchand220interviews.ItincludesanindepthanalysisofToyotasstrong
businessperformance.
LeanProductandProcessDevelopmentbyAllenWardandTheToyota
ProductDevelopmentSystembyLikerandMorganareusefulforinsightsinto
developmentfromaleanperspective.
TheBirthofLean,editedbyShimokawaandFujimoto,conveysaclear
senseofthemindset,principles,culture,andpersonalitiesbehindleanthinking.
ToyotaCulturebyLikerandMichaelHoseus.Hoseushasworkedboth
asaplantmanagerandHRmanageratToyota,bringinganinsidersindepth
understandingtothisbookontheheartofwhatmakesaleanenterprisework.
LeanThinkingbyDrs.WomackandJonesisanentertainingandwell
writtensummaryofsomeleanprinciplesbyauthorswhoknowtheirsubjectwell.
Ascautionedearlier,itpresentsananecdotalandcondensedviewthatmaygive
thecasualreaderthewrongimpressionthattheessentialkeyofleaniswaste
reductionratherthanacultureofmanagerteacherswhounderstandleanthinking
andhelpbuildthepillarsofrespectforpeopleandcontinuousimprovementwith
GoSeeandotherbehaviors.
TheMachineThatChangedtheWorld:TheStoryofLeanProductionby
Womack,Jones,andRooswasbasedonafiveyearstudyatMITintoleanandthe
Toyotasystem.
WorkplaceManagementbyTaichiiOhnoisashortbookbythecreator
oftheToyotaProductionSystem.Itwasoutofprintbuthasbeenrecentlyre
translatedbyJonMillerandisnowavailable.Thebookdoesnottalkmuchabout
TPSbutitcontainsaseriesofshortchaptersthatshowwellhowTaichiiOhno
thoughtaboutmanagementandleansystems.
43
LeanPrimer
BIBLIOGRAPHY
Fujimoto99.Fujimoto,T.,1999.TheEvolutionofaManufacturingSystematToyota,
ProductivityPressGeorge02.George,M.,2002.LeanSixSigma:CombiningSixSigmaQuality
withLeanProductionSpeed,
McGrawHill
Hayashi08.Hayashi,N.,2008.TopEngineerExplainsHowToyotaDevelopsPeople,Nikkei
BusinessOnline,Translatedathttp://www.gembapantarei.com/2008/08/
toyotas_top_engineer_on_how_to_develop_thinking_pe.html
Hino06.Hino,S.,2006.InsidetheMindofToyota:ManagementPrinciplesforEnduring
Growth,ProductivityPress
Imai86.Imai,M.,1986.Kaizen:TheKeyToJapansCompetitiveSuccess,McGrawHill
Ishikawa85.Ishikawa,K.,1985.WhatIsTotalQualityControl?TheJapaneseWay,PrenticeHall
Ishikawa86.Ishikawa,K.,1986.GuidetoQualityControl,AsianProductivityOrganization
Kato06.Kato,I.,2006.SummaryNotesfromArtSmalleyInterviewwithMr.IsaoKato,at
http://artoflean.com/documents/pdfs/Mr_Kato_Interview_on_TWI_and_TPS.pdf
LH08.Liker,J.,Hoseus,M.,2008.ToyotaCulture:TheHeartandSouloftheToyotaWay,
McGrawHillLiker04.Liker,J.,2004.TheToyotaWay,McGrawHillLM06a.Liker,J.,Meier,
D.,2006.TheToyotaWayFieldbook,McGrawHillLM06b.Liker,J.,MorganJ.,2006.The
ToyotaProductDevelopmentSystem,ProductivityPress
LM07.Liker,J.,Meier,D.,2007.ToyotaTalent,McGrawHillMcGrath96.McGrath,M.,1996.
SettingthePACEinProductDevelopment,ButterworthHeinemann
McGrath04.McGrath,M.,2004.NextGenerationProductDevelopment:HowtoIncrease
Productivity,CutCosts,andReduceCycleTimes,McGrawHill
NT86.Nonaka,I.,Takeuchi,H.,1986.TheNewNewProductDevelopmentGame,Harvard
BusinessReview,Jan1986,alsoin[CW95]
NT95.Nonaka,I.,Takeuchi,H.,1995.TheKnowledgeCreatingCompany,OxfordUniversity
Press
NTI84.Nonaka,I.,Takeuchi,H.,Imai,H.,1984.ManagingtheNewProductDevelopment
Process:HowJapaneseCompaniesLearnandUnlearn,HarvardBusinessSchool75th
AnniversaryColloquium,alsoin[HLC85]
Ohno07.Ohno,T.,2007,WorkplaceManagement,GembaPress
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Ohno88.Ohno,T.,1988.TheToyotaProductionSystem:BeyondLargescaleProduction,
ProductivityPressOST08.Osono,E.,Shimizu,N.,Takeuchi,H.,2008.ExtremeToyota:Radical
ContradictionsThatDriveSuc
cessattheWorld'sBestManufacturer,WileyParkinson57.Parkinson,C.,1957.Parkinsons
Law,BuccaneerBooks
Poppendieck,M.,Poppendieck,T.,2006.ImplementingLeanSoftwareDevelopment:From
ConcepttoCash,AddisonWesley
Reinertsen97.Reinertsen,D.,1997.ManagingtheDesignFactory,FreePressReinertsen09.
Reinertsen,D.,2009.ThePrinciplesofProductDevelopmentFlow,CeleritasPublishing
RS99.Rother,M.,Shook,J.,1999.LearningtoSee:ValueStreamMappingtoAddValueand
EliminateMuda,LeanEnterpriseInstitute
SF09.(editors)Shimokawa,K.,Fujimoto,T.,2009.TheBirthofLean,TheLeanEnterprise
InstituteSmith,P.,2007.FlexibleProductDevelopment:BuildingAgilityforChangingMarkets,
JosseyBassSR98.Smith,P.,Reinertsen,D.,1998.DevelopingProductsinHalftheTime:New
Rules,NewTools,WileyToyota01.Toyota,2001.ToyotaWay2001,ToyotaMotorCompany
Toyota08.Toyota,2008.http://www.toyota.co.jp/en/vision/message/Accessedon21Sep2008
Ward06.Ward,A.,2006.LeanProductandProcessDevelopment,LeanEnterpriseInstitute
WJR90.Womack,J.,Jones,D.T.,Roos,D.,1990.TheMachineThatChangedtheWorld,
HarperPerennialWJ96.Womack,J.,Jones,D.T.,1996.LeanThinking,FreePress
45
46
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LEAN PRIMER

LEAN THINKING: THE BIG PICTURE

The Pillars of Lean Are Not Tools and Waste ReductionTherearesome

Figure 1.1 the lean-thinking house

- don_t trouble your _customer_

- develop people, then build

relationships, trust, and coaching

LEAN SUMMARY: THE LEAN THINKING HOUSE

LEAN GOAL: SUSTAINABLY DELIVER VALUE FAST

Respect for People

FOUNDATION: LEAN THINKING MANAGER-TEACHERS Management

Respect for People

PILLAR ONE: RESPECT FOR PEOPLE

Respect for People

Figure 1.2 respect for people

Don_t Trouble Your _Customer_

Lean Respect for People

PILLAR TWO: CONTINUOUS IMPROVEMENT

(Go See) Gotothesource[theplaceofrealvalueworkgemba]tofindthefacts

Respect for People

Value and Waste

Table 1.1 14 principles

Respect for People

Indirect Benefits: The Lake and Rocks Metaphor

smaller batch size leads, on average, to smaller queue size

batch size (work package size)

transaction costs (overhead)

this is the lake and rocks effect

LEAN PRODUCT DEVELOPMENT

Respect for People

- intensive customer investigation

- teach and require people to use the records

- experiment, collect data, adapt based on data including management

Figure 1.9 LPD practices

Develop Long-Lasting Engineers with Highest Skill and Craftsmanship

- with short regularly-timed cycles, with small batches of work

Entrepreneurial Hands-on Chief - engineer responsible for technical and

Cadence and Timeboxing

Team Room with Visual Management

Set-Based Concurrent Engineering

ABOUT THE AUTHORS

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