1. All materials copyright  1992-2006 Lean Associates, Inc. all rights reserved. No part of this presentation may be reproduced without written permission from Lean Associates, Inc. 1000 Falcon Wood Way Lexington, KY 40511 (859) 552-5326 Leading the Change Process David Meier Lean Associates, Inc. Book Manufacturers’ Institute Management Conference Spring 2006 Book Manufacturers’ Institute Management Conference Spring 2006 Thanks to Jeffrey Liker for some information

2.  Copyright 2006 Lean Associates, Inc. 859-552-5326 2 The Toyota Way 4 P Model Philosophy (Long-term Thinking) People and Partners (Respect, Challenge and Grow Them) Process (Eliminate Waste) Problem Solving (Continuous Improvement and Learning) Source: Jeffrey Liker, Author: The Toyota Way

3. All materials copyright  1992-2006 Lean Associates, Inc. all rights reserved. No part of this presentation may be reproduced without written permission from Lean Associates, Inc. 1000 Falcon Wood Way Lexington, KY 40511 (859) 552-5326 Create a Long–Term Philosophy “A journey of one thousand miles begins with a single step…” Confucius “…Followed by about 2 Million difficult, challenging, continuous steps.” David Meier

4.  Copyright 2006 Lean Associates, Inc. 859-552-5326 4 Lean Systems are a Matter of Philosophy  Lean Thinking  “Learning to See” Waste  “Thinking Production System”  Good Thinking, Good Products

5.  Copyright 2006 Lean Associates, Inc. 859-552-5326 5 Defining the Purpose of the Organization Company Purpose Learning Community ST: Capable People LT: Learning to Improve Lean Systems ST: Capable Processes LT: Value Stream Improvement Learning Enterprise ST: Capable Partners LT: Learning Enterprise Value-Adding Contributor ST: Profitable LT: Growth and contributing to society Key: ST=Short term LT=Long term Internal External People Business

6.  Copyright 2006 Lean Associates, Inc. 859-552-5326 6 Start with Philosophy… end with desired results

7.  Copyright 2006 Lean Associates, Inc. 859-552-5326 7 Establish a Long-term Vision  Why do lean?  What is your personal motive?  How will you create an environment that goes beyond mere compliance?  Are you committed to the journey?

8.  Copyright 2006 Lean Associates, Inc. 859-552-5326 8 What is Leadership?  Getting people to go where they would not normally go  Getting people aligned to a common objectives  Having guts  Being a talent scout and developing talent

9.  Copyright 2006 Lean Associates, Inc. 859-552-5326 9 Great Leadership Begins With Desire  More than a desire for the position or rank  Leadership skills can be taught, desire can not –Desire to learn –Desire to face the challenges –Desire to find the value in people –Willingness to persevere

10.  Copyright 2006 Lean Associates, Inc. 859-552-5326 10 The Process Always Begins With Leadership  Are you willing to make short-term sacrifices for long-term benefit?  Can you make the tough decisions?  Are you willing to stand against the tide?  Are you willing to face the challenges of changing a culture?  Really?

11.  Copyright 2006 Lean Associates, Inc. 859-552-5326 11 Committed versus Involved  Cow, Chicken, and Pig  How much will you learn about the process? –How will you guide and coach if you do not learn?  How much time will you personally invest? –Many people sense the commitment of the leader and commit to the same degree

12.  Copyright 2006 Lean Associates, Inc. 859-552-5326 12 Focus on the Desired Outcome… …not just the roles and responsibilities of the position  Supporting Operations- Continuously improving process and results  Supporting and developing people (a leader develops other leaders)  Leading the people in the process of change

13. All materials copyright  1992-2006 Lean Associates, Inc. all rights reserved. No part of this presentation may be reproduced without written permission from Lean Associates, Inc. 1000 Falcon Wood Way Lexington, KY 40511 (859) 552-5326 People “If it weren’t for the people this would be easy.” “But, if it weren’t for the people this would be impossible.”

14.  Copyright 2006 Lean Associates, Inc. 859-552-5326 14 Importance of People at Toyota  “We build people, not just cars.”  Toyota is frugal on manufacturing expenses, but lavish on people costs (development, incentives, rewards).  Thinking is a critical ability and it is expected. Without the ability to think and to improve the system is useless.

15.  Copyright 2006 Lean Associates, Inc. 859-552-5326 15 Importance of People  Motivating  Developing  Challenging  Getting the best thinking  Getting the best effort  Maximizing the return on human investment

16.  Copyright 2006 Lean Associates, Inc. 859-552-5326 16 The $64,000 Questions  How do you get people to “buy in”  How do you convince the people who don’t want to change?  How do you get people motivated?  What was wrong with the old way?

17.  Copyright 2006 Lean Associates, Inc. 859-552-5326 17 Nucor Steel on the Art of Motivation  Employees will make an extraordinary effort if you reward them richly, treat them with respect, and give them real power.  The art of motivation is about an unblinking focus on the people on the front line of the business.  Nucor does not just create steel, they create knowledge.  “Our culture is a living thing. It will never die because we will never let it die, ever.” Business Week 05/01/06

18.  Copyright 2006 Lean Associates, Inc. 859-552-5326 18 Making the Work Meaningful  People want to know that what they do matters  People expect to have meaning in their work –Let’s face it, the task can be routine  There is a high priority on learning and development  People like to feel a sense of accomplishment

19.  Copyright 2006 Lean Associates, Inc. 859-552-5326 19 The Key to Motivation- Know the People Moving away from negative influence Moving towards positive influence Fear, Reprisal, Loss Challenge, Reward, Achievement Embarrassment, Failure Money is not the only motivator!

20.  Copyright 2006 Lean Associates, Inc. 859-552-5326 20 Clarify Expectations Above Expectation Below Expectation Not everyone needs to be a star But no one can be below expectation

21.  Copyright 2006 Lean Associates, Inc. 859-552-5326 21 Helping People Develop Capabilities  Identify interested people  Know people –What do they like and want?  Find what is aligned with the needs of the organization  Specify your interests and needs  Identify obstacles and need for change  Provide Support  Provide Guidance  Achieve mutual objectives

22.  Copyright 2006 Lean Associates, Inc. 859-552-5326 22 The People Bell Curve C.A.V.E. 5% W.A.V.E. 5% W.A.S 90% Where will you spend your time and effort?

23.  Copyright 2006 Lean Associates, Inc. 859-552-5326 23 The People Curve True C.A.V.E. True W.A.V.E. More Cave Tendencies More Wave Tendencies You need to find the 5% of the population from the WAS group who can influence the masses

24.  Copyright 2006 Lean Associates, Inc. 859-552-5326 24 Reach the Critical Mass  Small percentage will influence the masses  Reach the unofficial leaders  People don’t like to be left out of something good  People don’t want to stand alone from the crowd

25.  Copyright 2006 Lean Associates, Inc. 859-552-5326 25 Continuous Improvement “Until you take the first step, it will not be possible to see the next step” “Some days, big up” “Every day, little up”

26.  Copyright 2006 Lean Associates, Inc. 859-552-5326 26 Questions / Comments  Contact Information:  David Meier 859-552-5326 Dmeier@leanassociates.com