Lean Leadership 002: The Lean Islands!

Toyota’s success isn’t attributable to the company’s usage of a conventional “lean” manufacturing procedure or any internal Six Sigma implementation. It is, instead, centered on leadership. It can be found, more specifically, in a Toyota leader’s mentality, which sees self-development and training others as the only method to not only discover the right answer for the issue at hand, but to enhance performance day after day.

Few companies see the link between Toyota’s great performance and its leadership. They notice Toyota’s methodical approach to everything it does and immediately assume that the technical system is the solution.

While considerable benefits from TPS or lean implementation are common, they are almost never sustained. Why? Because tools and blitz events lack the leadership required to educate and sustain large-scale process change within an established corporate culture.

This is not to say that “lean” isn’t useful. Lean projects, on the other hand, have benefited thousands of firms. These accomplishments, however, are best described as “point improvements” that have nothing to do with a bigger set of corporate goals. Installing a procedure in a firm silo is the ‘point method.’
In the case of lean, the silo’s production lead time might be reduced from five to three days, or production costs could be reduced by 20%. Everyone congratulates each other and move on to the next ‘island’.

Backsliding

Over time, it becomes clear that these point improvements are difficult to transfer to other areas of the company. Worse, they aren’t self-sustaining. Without the ongoing vigilance and dedication of managers and workers alike, without leadership, backsliding is common and swift, with three days expanding to four and then four and a half.

A healthy life style change or a crash diet!

Most companies that go lean, like most people who go on diets, delude themselves into believing that the change effort is a time-limited exercise. For the time being, the company simply needs to eat less and exercise more. It fails to recognize that in order to remain lean, a company, like a person, must live lean… indefinitely. It is literally a matter of resetting the corporate metabolism, even rewriting its DNA.

Simply changing a process, introducing a methodology, or implementing a change management program will not be enough. True systemic change must begin with a company’s people at its core. It must, above all, be embodied by the company’s executives.

Toyota Production System is the ‘effect’, not the ’cause’!

Leaders and the leadership paradigm that Toyota cultivates are at the heart of the company’s significant involvement of team members across the board. The Toyota Production System is the outcome, not the source, of this involvement. Toyota executives strive for continuous development in all elements of the company, and achieving that goal requires collaboration from top executives to heads of small work groups on the shop floor. This demands consistent leadership across all divisions and at all levels of management over a long period of time.

To put it another way, this is the kind of leadership that a few superstars with tremendous talent or charisma can never provide. It’s not the kind of leadership that can be hired and installed overnight. Because of this leadership approach, Toyota has been able to overcome various significant hurdles in a dynamic and competitive industry. It’s how the company developed the next generation of leaders to aid in its global expansion. It’s also how it coped with the need to stay afloat amid the financial crisis of 2008.

NOTE: Next post will provide some insights into the obstacles in the way to building a viable culture of continuous improvement … stay tuned!