Lean Management and the role

of Lean Leadership
Akhil Chugh
Rashmi Sharma
Every Organization Must Address

 Purpose – Provide value to customers in

order to prosper.

 Process– Through smoothly flowing value

streams for design, make, and use.

 People– By engaging every employee

touching value streams (including support
streams) to sustain and improve the flow.
Most Organizations Struggle
 Purpose is not clearly defined in terms of
solving the customer’s problems.

 Processes are not clearly specified.

 Peopleare not engaged in optimizing the

whole value stream rather than the point
where they work.
Lean Management

 Addresses the purpose problem by

identifying product family value streams
for specific customers:
� Makes value easier to specify.
� Makes the flow of value easier to see.
Lean Management
 Addresses the process problem by
assigning a leader to each value stream:
� Makes current condition of entire
process clear to everyone.
�Proposes a better “future state” process
and takes responsibility for implementing
it.
�Makes condition of the new “current
state” clear to everyone.
�Proposes a still better “future state”.
Lean Thinking
 Five step approach:
• Find a change agent.
• Find a sensei (to get the knowledge.)
• Seize or create the crisis.
• Map your value streams.
• Get started on creating better value
streams.
 But…how do lean leaders lead this
process?
What is “Lean”?
 Leanis a philosophy of production which
emphasizes providing value to the
customer and eliminating waste.
The Impact of Becoming Lean

Toyota has overtaken Ford as number

two in the global motor industry
It intends to overtake General Motors
to become number one by 2010

“Brilliant process management is our

strategy.” Senior Toyota executive
Defining Lean

 Continually reducing waste in all

areas and in all forms
 English phrase coined to summarize
Japanese manufacturing techniques
(specifically, the Toyota Production
System)
What Does it Mean to be
“Lean”?
 “It is not possible to ‘Be Lean.’

 Itis only possible to work toward ‘Becoming

Lean.’

 Being “Lean” would mean there is a process in

place that will ensure the ability to continuously
improve people and business performance-
forever”.
Basic Tenets of Lean

Specify Value Map the Value

Stream
Make Products
Flow Pursue
Perfection
Implement Pull
Defined by Womack
& Jones in their book,
Lean Thinking
Difference between Traditional
Leadership and Lean Leadership
Traditional Leadership
 Leader plans
 Staff meets goals set by
Leader
 Leader produces
metrics and Feeds back
when not met
 Rigid enforcement of
rules and regulations
Lean Leadership
 Direction setter
 Ensures team goals
support vision
 Monitors and audits
team’s metrics
 Sets expectations

Traditional Leadership
 Information controller
 Sole problem solver
 Technical expert
 Assignor of work
 Performance appraiser
Lean Leadership
 Information conduit
 Facilitates ‘root cause’
analysis
 Technical resource
 Provider of forward
workloads
 Appraises team
performance to team
goals
Lean People Make a Lean Enterprise
 An Enterprise is a collection of people
voluntarily banding together to produce a
product or service
 To have a Lean Enterprise, you have to
have Lean people
 People have to get Lean before the
enterprise can get Lean
Lean People Have Something
Understanding Value
Lean Thinking starts with specifying value
from the customer’s perspective
 Identifying your customers

internal or external
 Identifying customer’s needs
 Meeting customer’s needs
 Measuring performance from
the customer’s perspective
Adapting Quickly
Customer demands are constantly shifting,
so products and processes must change
 Overcoming resistance to change
 Re-channeling anxiety into
productive creativity
 Taking advantage of the new
environment
Leading From Below
Leaders are people who influence others
 Leaders Envision
– Analyze the current situation
– Imagine a new future
 Leaders Align
– Set priorities
– Define intermediate goals
 Leaders Empower
– Empowering yourself & others
Taking the Initiative
A Lean Enterprise can’t afford to
have people waiting to be told
what to do and how to do it
 Setting goals
 Developing plans to achieve goals
 Measuring progress against the plan
 Maximizing personal productivity
 Managing time and being organized
 Innovating
A Lean Enterprise will rely on the creativity
of its people as never before
 Analyzing problems
 Applying critical thinking processes
 Developing creative responses to new
demands
Collaborative
Collaborative Groups know their processes and
how they relate to the overall operation
 Inter-company teams
Customers, Suppliers, Competitors
 Project Teams
Address a specific issue
 Self Directed Work Teams
Manage the day to day operations
How To Create Lean People
 The Lean Enterprise must assure its
people possess knowledge, experience,
skill
 Experience is something that happens
over time but must be supported
 Knowledge and skills come from
education and training
 Management must put a plan in place
– Starts with identifying the needs, continues
with education and follows up with training
Lean Leadership:
The Toyota Way
The 4 Ps of ‘The Toyota Way’
The leader’s job at Toyota…
 First,get each person to take initiative to
solve problems and improve his or her
job.
 Second, ensure that each person’s job is
aligned to provide value for the customer
and prosperity for the company.
 Toyota Production System
Best Quality - Lowest Cost - Shortest Lead Time - Best Safety - High Morale
through shortening the production flow by eliminating waste

Just-In-Time People & Teamwork Jidoka

“Right part, right amount, • Selection • Rigid decision making (In-station quality)
right time” • Common Goals • Cross-trained “Make Problems Visible”
• Takt time planning
• Automatic stops
• Continuous flow • Andon
• Pull system • Person-machine
• Quick changeover
Continuous Improvement
separation
• Integrated logistics • Error proofing
• In-station quality
Waste Reduction control
• Gemba Kaizen • Eyes for Waste • Solve root cause of
• 5 Why’s • Problem Solving problems (5 Why?)

Leveled Production (Heijunka)

Stable and Standardized Processes
Visual Management
Toyota Way Philosophy
 The leader’s job is to develop
his or her people

SPIRIT of Lean
Mentorship:
“If the learner hasn’t
learned, the teacher
hasn’t taught”
Leadership: Three Models
 Old “Dictator” Style: “Do it my way…”

 1980s “Empowerment” Style: “Do it your

way... ”

 Lean Style: “Follow me…and let’s figure

this out together ”
 A Toyota Leader’s View of the
Toyota Production System
 Toyota Production System=Operations Management System to achieve
goals of highest quality, lowest cost, shortest lead time via engaging
people toward goals.

Technical: Management:

M
• Stability AL •True North

AN
PEOPLE
IC
• JIT • Tools to focus

AG
N

• Jidoka management
CH

• Kaizen Long-term asset→Learned Skills attention

EM
Machinery depreciates→Loses
TE

• Heijunka • Go & See

EN
Value • Problem-solving
People appreciate →Continue to

T
• Presentation skills
grow • Project
management
PHILOSOPHICAL • Supportive culture
Philosophy/Basic Thinking
• Customer First • People are most important asset
• Kaizen • Go & See Focus on Floor
•Give feedback to team members and earn respect • Effciency Thinking
• True (vs. apparent) condition • Total (vs. individual) team involvement
Leadership at Toyota-
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 results
reflect the past performance of that
process.
 Far better is to create a process that can be
managed right NOW.
Leadership at Toyota-
From the Five Who’s to the Five Whys
 Good Toyota leaders don’t jump to
conclusions or solutions – they try to first
size up the situation and then ask “Why?”
 This focuses on the work and problem at
hand, avoiding finger-pointing seeking of
where to place the blame.
 It also keeps responsibility with the
person who is doing the work.
 This is what truly engages and empowers
the workforce.
Leadership at Toyota
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.
Leadership at Toyota
Control with Flexibility
 Toyota’s way provides extraordinary
focus, direction, “control.”
 While at the same time providing
maximum flexibility.
 I believe this solves the age-old dilemma –
control vs. flexibility – that encumbers all
large organizations.
P-D-C-A helping leadership at
Toyota
 Grasp
the
situation
grasp the situation

ADJUST HYPOTHESIS

REFLECT TRY
 Problem and PDCA tools at
----------------------------------------------------------------------------------------------------------------

different levels

ROLE IMPACT

Must provide vision Likes the result

and incentive

Must lead the Left with changed,

actual operational uncertain roles
change

Must “do” Likes the

involveme
nt

A Difficult Struggle at the Mid-management and

First Line Supervisory Level
Chairman Cho of Toyota:
Three Keys to Lean Leadership
 Go See.
• “Sr. Mgmt. must spend time on the plant floor.”

 AskWhy.
• “Use the “Why?” technique daily.”

 Show Respect.
• “Respect your people.”
Thank You