1. Creating a Sustainable Lean Culture
“Leaders have to be Learners”
Process
Tom Shuker
People

2. Sustainable Lean Culture
What does this mean?
What does it look like?
LEAN TRANSFORMATIONS GROUP, LLC.© ALL RIGHTS RESERVED

3. Culture Culture can only be grown It can not be copied or transplanted
It can only be developed over time
Culture lives in the day to day, not in abstract values and feel good slogans
Culture is who we are-embodied in what we do when nobody is looking
Culture is learned through doing, not through classes, readings, or exhortations
Peter M. Senge – The Fifth Discipline

5. The NUMMI Success Story

6. Equal to Takaoka Japan Productivity Best in GM Close to Takaoka Japan
The NUMMI Success Story
Results
In about one year…
Quality Best ever in GM
Equal to Takaoka Japan Productivity Best in GM
Close to Takaoka Japan

7. C U L T U R E The Culture Question
Change Culture
First
Change System
First
WHAT WE DO
VALUES - ATTITUDES
C U L T U R E
Where Do You Start – Either? Both at once?

8. Training Within Industry course being taught in California in 1985

9. Training Within Industry
TWI - The training program instituted to support the U.S. war production effort from 1941 – 1945
Two million Americans
trained over four year period.
This training is forgotten in
the US - now making a comeback!
It formed the basis of Toyota’s
core training. Toyota still uses much of it to this day!

10. Continuous Improvement (Lean) Today
Now spreading rapidly beyond repetitive manufacturing operations to all functional areas in firms and to new industries
Success stories in many non-manufacturing industries:
Government: EPA, City of Grand Rapids, MI. Jacksonville, Indiana, State of Michigan
Lots of health care examples: Michigan Hospital Association, Mayo, U of Michigan, VM
Capital One ( financial services)
U.S. Military: aerospace, shipbuilding
Starbucks in retail.

11. Discussion Question Why? Lean is a proven successful business model.
Many have tried to adopt and adapt it, some successfully, some MOST not.
Why?

12. How Lean Implementation is Changing
NOW
PAST 10 YEARS A P C D
PDCA cycle
Solving Problems
Growing Knowledge and Capability 12

13. Think Different.

14. Lean includes a change in mindset
Why Think Different?
“You can’t solve today’s problems at the same level of thinking you were at when you created them.”
Albert Einstein
Lean includes a change in mindset
Organizational Complexity
From top down blanket solutions to solving the problems in the way we work
Outcomes: Participants get a feeling that this is really different and important from other initiatives.
Time

15. “What sets the operations of [Toyota] apart is the way they tightly couple the process of doing the work with the process of learning to do it better as it’s being done. Operations are expressly designed to reveal problems as they occur…. And managers constantly develop and encourage their subordinates’ [problem solving] ability to design, improve and deploy such improvements.” Steven Spear HBR, Sep 2005

16. Two Paradigms Problem Solving through Blanket Solutions Thinking
rapid small experiments
Blanket Solutions Thinking
Solution

17. Solutions Thinking vs Problem Solving
D C A P
D C A
Learning path
to solving
business problems P
D C A
Blanket Solutions Model
Problem Solving Model
Implement
Solutions
NOW!!
Need to direct people
Need to control
Fragmented/Reductionist
Knowers
Results Focus
Need to engage people
Need to build capability
Systems/Integrated
Learners
Means Focus

18. What Strategies Do Companies Use to Continue Growing and Improving?
Mergers
Reducing headcount across the organization
Hiring freezes
Reorganizing
Moving operations off shore
Hiring a new team of leaders
Buying IT systems
What problem(s) are we addressing with these solutions?

19. Problem Solving by Level
A P
C D
Problem Solving by Level
A P
C D
Strategic
Problem-Solving
A P
C D
A P
C D
Coaching
A P
C D
A P
C D
A P
C D
A P
C D
Problem-Solving
Value Stream
Coaching
A P
C D
A P
C D
A P
C D
A P
C D
A P
C D
A P
C D
A P
C D
A P
C D
A P
C D
A P
C D
A P
C D
A P
C D
A P
C D
Problem-Solving
Value Added/
Gemba
A P
C D
A P
C D
A P
C D
A P
C D
A P
C D
A P
C D
A P
C D
A P
C D
Doing

20. Three Significant Points
“What sets the operations of [Toyota] apart is the way they
Tightly couple the process of doing the work with the process of learning to do it better as it’s being done.
Operations are expressly designed to reveal problems as they occur….
And managers constantly develop and encourage their subordinates’ [problem solving] ability to design, improve and deploy such improvements.”
Steven Spear HBR, Sep 2005
Problem Solving
Capability
Designed Value Streams
Developmental
Leadership

21. FACTS IDEA Problem Solution Get into the Dirty Details
Solutions Thinking
MAGICAL?
Problem
Solution
ACTIONABLE?
Problem Solving
FACTS
Real Problem
Learning Cycles
Plans
Target Condition
Causes
Actions
Get into the Dirty Details
…but not the weeds

22. Problem Solving around Value Streams
Cultural Unquestioned Assumptions
Address values, policies, and procedures
Value Streams
PDCA management for continuous improvement
Support Systems
Suppliers
Managers
Expose and respond to problems
Keep operators in value field

23. What has been your role as a Leader with respect to Learning and Continuous Improvement?

24. Gettin’ Away from the Gemba
ASSUMPTIONS: about what actually happened and what it means
What We Tend to Report
Interpretations: conclusions about the nature of situations and events and what “really” occurred
Impressions: recognition of patterns, trends, types and familiar elements in situations and events
Experiences: what is directly seen, heard, sensed, felt and perceived from the actual conditions of a situation or event

25. Reason for Going to the Gemba
“I guess I shouldn’t rely on Ben to do the detail design checks for the team”
“Ben’s doesn’t pay attention to the design standards and details the way he should.”
“It looks like he did a quick check and missed two different dimensions”
“We found out that the design standards were from an old design and never updated by the design standards team.”
Assumption
Interpretation
Impression
Experience

26. How do we Take Our Organization to a New Level of Performance?
Cultural Unquestioned Assumptions
Performance
Question your own assumptions
Galileo
Time

27. Key Values of Lean
Mutual respect and long-term prosperity (employees, company, customer, community)
“Customer first” focus
Continuous Improvement (Kaizen)
Never knowingly pass a defect to the next process
Problems are treasures
Genchi Gembutsu (“go see for yourself”)

28. Plan-Do-Check-Act Management Cycle
Creates the culture of:
Problem Solving
Learning
Continuous Improvement

29. You live in a noisy system
Environment
Leadership is about knowing who you are as an agent of change inside the noisy system
Business
Self

30. “Grasp the Situation” Environment Business(Internal) Self
Understanding your external environment, market, customer, enemy, and changing circumstances
Business(Internal)
Understanding the capability and condition of your organization, employees, partners and all members of the organization
Self
Challenge of being passionate, and attaining goals and dispassionate about assesing and determining next steps --- “ A Learner and a Knower in the right balance”

31. The Leader’s Job…  Aligning purpose, process, and people is the central task of management.
Based on John Shook Lean Management Columns, lean.org 2009

32. What to do?
IF an effective lean system is equal parts:
“Social” - People
All the people, thinking, organizational, people, cultural aspects of how your organization engages and aligns its people to accomplish its purpose
“Technical” - Process
All the process, technical, mechanical, process, ways work is designed to deliver value to the customer and accomplish its purpose
Our job as lean leaders is to align those to achieve the purpose of the organization.

33. The Technical Side of Lean
Process
The Value Stream Perspective for Alignment and Focus
Managing Primary and Secondary Value Streams
Selecting Value Stream Performance Problems

34. Three Significant Points
“What sets the operations of [Toyota] apart is the way they
Tightly couple the process of doing the work with the process of learning to do it better as it’s being done.
Operations are expressly designed to reveal problems as they occur….
And managers constantly develop and encourage their subordinates’ [problem solving] ability to design, improve and deploy such improvements.”
Steven Spear HBR, Sep 2005
Problem Solving
Capability
Process
Designed Value Streams
Developmental
Leadership

35. Are the efforts focused on the right problem?
Your
Delivery
Customer
Customer Delivery Value Stream
Measurements
On time delivery
Quality
Lead Time
Cost/Price
Customer satisfaction
Problem Solving begins with leaders identifying the business problem.

36. What is the most significant problem of your Primary Value Stream(s)?
Customer?
Customer Needs?
Deliverables?
Most Significant Performance Problem?

37. Three Significant Points
“What sets the operations of [Toyota] apart is the way they
Tightly couple the process of doing the work with the process of learning to do it better as it’s being done.
Operations are expressly designed to reveal problems as they occur….
And managers constantly develop and encourage their subordinates’ [problem solving] ability to design, improve and deploy such improvements.”
Steven Spear HBR, Sep 2005
Problem Solving
Capability
Process
Designed Value Streams
Developmental
Leadership

38. How is your Value Stream performing? (Functional Support)
Product Development
Marketing
Personnel
Finance
Sales
Purchasing
Maintenance
Supply Chain
Scheduling/Forecasting
Technical Support

39. Firmly Grasp The Current Condition
PDCA Management
Firmly Grasp The Current Condition
Implement the Plan
Measure the results
Develop a Hypothesis
Adjust as required or standardize
Act
Plan Do
Check

40. You are Need to be Here Here
GAP
A P
C D
Target Condition
A P
C D
BARRIER
Remove
Overcome
Eliminate
A P
C D
CONSTRAINT
A P
C D
Current
Condition
CAUSE

41. Lean/CI Problem Solving by Level
Problem SOLVING TOOLS
TARGET CONDITION
Engaging Organization Culture
Supporting value stream & systems
Understanding the environment you live in
Management environment & behaviors
Structure, roles and relationships
Policies and practices
Senior Leader Value Field Analysis
Project Team Value Stream Mapping
Capable Value Streams that Flow & Timely Deliver Quality
Reliable Work Methods & Technology & Skilled Employees that produce consistent output
Team-Created Standard Work Procedures

42. Three Significant Points
“What sets the operations of [Toyota] apart is the way they
Tightly couple the process of doing the work with the process of learning to do it better as it’s being done.
Operations are expressly designed to reveal problems as they occur….
And managers constantly develop and encourage their subordinates’ [problem solving] ability to design, improve and deploy such improvements.”
Steven Spear HBR, Sep 2005
Problem Solving
Capability
Designed Value Streams
Developmental
Leadership
People

43. The Social Side of Lean (Breakout Session)
Creating the Environment for Problem Solving and Learning
Engagement and Change Through Modeling
Practice of Humble Inquiry for Deployment and Engagement
Grasping the Actual Condition of Process Execution

44. Management by Numbers versus Management by Facts
Management by Numbers allows Management at a Glance:
Are the Numbers Right?
Management by Facts requires
Management by Thinking:
What are the Facts Saying?

45. Traditional vs. Lean Management
Style of Management
Focus
Method
Traditional
Results (ends)
Delegate Tasks
Control (Squeeze) for Results
Lean
Process (means)
Deploy Responsibility
Build Performance Capability
People
People

46. Systems Model for Lean Transformation
Unquestioned
Assumptions
Value Streams
Patterns
Problems 46

47. Unquestioned Assumptions
That Drive Complexity
Blanket solutions
Use of CI specialists to solve organizational problems
Not building capability of others
Missing opportunities for learning
Focused on the final result, not on the problem solving process
Result-oriented
Fragmented Thinking
Command & Control
Defensive
Knower’s
Failure is not allowed
Employees feel the need to justify their actions
Someone else caused the problem
Rationalization of data
Fragmented actions
Lack of organization wide strategy
Silos
Metrics and status reports are the primary management tool
Deferring to the person of highest rank

48. Assumptions that Drive Continuous Improvement
Let’s Identify the problem and solve it together
Process oriented
Systems Thinking
Leader as Teacher
Internalize
Learner
Means-oriented
Systems thinking
Give Problem Solving Responsibility
Self Reflection
Learners
Focused on the means to achieve great results
Processes and people are aligned to achieve organizational goals
Environment where it is OK to fail
Go See
Mentor people to develop problem solvers

49. Keys to Making the Transition
Results
Means
Fragmented
Systems
Command and Control
Give Problem Solving Responsibility
Defensive Reasoning
Self-Reflection
Knower
Learner

50. Discussion Question Lean is a proven successful business model.
Many have tried to adopt and adapt it, some successfully, some MOST not.
Why?
What role does Leadership play?
“Leadership vs. knowledge”?

51. Eiji Toyoda on Leadership
“The people at the top are just flag-wavers. It is pure MUDA to wave your flag and have no one follow you. Waving that flag in a way that makes people fall in line behind you is what is important.”

52. Role of the Lean Leader
Lead
define purpose, priorities and role requirements
Engage
deploy meaningful responsibility appropriate to level
Enable
manage the work environment and support systems
Coach
develop problem solving skills and job-handling capability

53. Toyota Way From managing numbers to managing the process
Leaders at Toyota, like leaders anywhere, want to see measurable results.
But they know that the financial result is a result of a process.
They also realize that the financial result is the result of the past performance of that process.
Far better is to create a process that can be managed right NOW.

54. Toyota Way From Problem-hiding to Problem-solving
All actions at Toyota revolve around planning and problem-solving.
It is assumed that there will be problems, that everything will not go according to plan.
“No problem is problem.”
For the system to work, problems must be exposed and dealt with forthrightly.
Hiding problems will undermine the system.

55. Toyota Way Responsibility and Authority
John Shook * David Verble
Toyota Way Responsibility and Authority
In my two years at Nummi, I was almost never told exactly what to do or how to do it.
Yet, I was not free to just do what I wanted.
I was given (meaningful) clear responsibility to propose solutions to problems I owned. 21

56. What is Meaningful Responsibility?
Delegated tasks and assignments?
Responsibility for the outcome? The Deliverable?
Responsibility that carries with it the requirement to think plan, initiate, problem solve and take leadership to achieve the outcome.
Responsibility for the Ends without being told the exact Means to use to achieve them.
Responsibility to participate in Catch-ball give- and-take to come to agreement on the specifics of both the ends and means

57. And why is Meaningful Responsibility Important in Lean?
Discretionary Effort
“You hire my time and are due a full day and a good effort. You can define my responsibilities, program my activities and evaluate my performance. You can control what you see. But I can decide how far I go beyond that and for what.”

58. Problem Solving Culture Assessment
Just To Some Very Barely Extent Much
Employees know that at their level:
They are expected to recognize and respond to problems at their level
They are allowed to point out and react to problems at their level
Their supervisors believe they are capable of addressing problems at their level
They have the means and support to address problems at their level
That addressing problems they recognize is critical to the performance of their group, their department and the company
They have tools to distinguish normal from abnormal and the ability self-manage their work performance to a large extent
And believe that addressing problems is worthwhile for the company, their group, their department and themselves personally