That is a great question. Let me share what we did at Danaher several decades ago—the lessons are still relevant today.
I joined Danaher as a Group Executive at the end of 1985. Danaher at the time was about $1 billion in sales and consisted of 13 different operating companies. The corporate office was in Washington D.C. and consisted of the two Rales brothers (the majority owners), their two assistants, and a corporate finance staff of less than ten.
All the day-to-day operations were the responsibility of two group executives, who shared an office and an assistant the Bloomfield, CT, office of one of my group companies, Jake Brake. To say we believed in low overhead and a low profile would be an understatement.
Two of my group companies, Jacobs Chuck (which made drill chucks) and Jacobs Brake (Jake Brake, which made engine retarders for diesel trucks), were in terrible shape when I got there. We believed that the only way for TPS to have any chance would be if it were driven by the presidents of the individual businesses.George Koenigsaecker (the head of Jake Brake) and I were the only people in Danaher with prior experience with what was then known as Just-in-Time manufacturing.
We decided to use that to turn Jake Brake around. We started this work in mid-1986 by creating a couple of cells, cleaning things up, reducing inventory, and lowering costs. At the time, we didn’t have much knowledge about what Toyota had been doing. We were learning as we went along.
In the spring of 1987, we met the three individuals who comprised Shingijutsu Consultants at a conference in Hartford, CT. They had just started their consulting firm after spending their entire careers working at Toyota for Taiichi Ohno, the father of the Toyota Production System (TPS).
Koenigsaecker was all over them, and we convinced them to come and work for us at Brake and Chuck. Holy smokes! It was like a bomb went off—we began learning so much and changing things very rapidly, especially at Jake Brake. Pretty soon, the Rales brothers came to see what was going on. We spent the afternoon with them, and to their credit, all they said was: “Wow, this is great. How fast can you do it in the rest of the Danaher companies?”
Great news—until we asked Shingijutsu to help us. They said no. They would not help with this until Chuck and Brake got a lot better. So we needed to learn how to scale the improvements beyond isolated points and make them company-wide practices. The question was: how?
Ensure Buy-in Through Leadership Participation
We believed that the only way for TPS (which we were calling DPS, for the Danaher Production System) to have any chance at the other 11 Danaher companies would be if it were driven by the presidents of each of these businesses. For that to happen, we had to help them understand what TPS was and what it could do for their business.
To do so, George, John Cosentino (the other group executive,) and I created the president’s kaizen. We wanted them to observe TPS closely and get a hands-on understanding. So our first step was taking all 13 presidents and their vice-presidents of operations to Japan for a week, visiting Toyota and Shingijutsu's clients. We visited eight factories and did some training in the evenings.
These kaizen workshops helped the presidents overcome objections to change in their own companies.When we returned, we asked every president and their vice-presidents of operations to participate in one three-day kaizen every six weeks, starting in Cosentino’s plants. They were grumpy about this at first. “I’m a president,” some would say, “Why do I have to spend a week on some other company’s shop floor moving things around and getting all dirty?” This griping was invariably offset by the mind-boggling results we got after three full days of this work every single time. We soon found that the presidents would clear their calendars to keep them from missing the next president’s kaizen.
Holding these kaizen workshops in our factories demonstrated how serious Danaher was about TPS to the entire company. And it provided all of the presidents with ammunition to overcome objections to change in their own companies. If one of their staff said, “this will never work here,” they could point out some of the amazing changes they saw at the last president’s kaizen. These learning sessions modeled by top managers were crucial in accelerating the move to TPS and lean within Danaher.
And how does this apply to you? Of course, your company is not Danaher, and you probably have folks on your management staff who respond to potential change like this by saying, “this will never work here.” How do you get them onboard? This answer varies, depending on your size and structure. If you have several different businesses like Danaher, you can just copy the president’s kaizen model. The key is to make it an ongoing way of life and not just a one-off kaizen example. Make them attend every six weeks or so, joining a kaizen team for the first 2 to 3 years of your lean turnaround. Put them on the shop floor and get their hands dirty. And when they return to their workplace, have them conduct a kaizen or two every month. They can report their results to senior management. They can do this in the evening at the next president’s kaizen session after the kaizen is done for the day. You will start to improve quickly.
At Wiremold, we ran president’s kaizen events with our division presidents and my senior staff. Not only did we realize great tangible results, but we also built great teams while doing so.
Use Kaizen to Tally Results and Build Teams
After retiring from Wiremold, I worked in private equity, where these lessons applied to a wide range of companies around the world. I was chairman of one company with large operations in Europe, making traditional filing products in about 12 different factories all over Europe. We conducted many president’s kaizens at our biggest factory, which was in Poland. This exercise included every plant manager plus all of the senior European staff. Also participating were the head of the private equity firm that owned 100% of the company (the owner), myself (the Chairman), the worldwide company CEO, and the president of European operations. We were all on the shop floor every day all day for the five-day kaizen, which sent a strong clear message that we were serious about this.
Once more, I saw the amazing things that can happen with a mixed group like this. For example, we were trying to reduce a two-and-a-half-hour setup from one size paper to another on one Always keep in mind that to be successful with lean, senior management must drive the change.team with a sales and marketing member, and someone asked: “why are we even doing this?” The factory folks knew that they had to make this product even though it was a very long and complicated setup. The marketing guy on the team, on the other hand, could look at it from a commercial point of view and decide that the volume was so low that we shouldn’t even be selling the second size of paper. As a result, we discontinued the second size, switched the customers to the more standard size, and eliminated the setup. The setup time went from two and a half hours to zero; the total cost also dropped to zero.
In addition to getting great results quickly, the president’s kaizen builds teamwork and creates a company culture of continuous improvement. The 13 Danaher companies had no real connection to each other from a business point of view. When the presidents began getting together every six weeks to work on kaizen teams, they united around our lean approach and started to build a culture within Danaher. I experienced the same at Wiremold and in my portfolio companies in private equity.
Becoming lean can’t happen without leadership being visibly on board and leading the way. Working together on kaizen teams will help your leadership team understand the value of kaizen and lean while at the same time getting a better appreciation for each other. This approach will lower the traditional finger-pointing and get the whole management team moving in the same direction. Just as important is the message it sends to the entire company to see the leadership out on the shop floor working with the hourly kaizen team members to eliminate the waste and make their jobs easier. Everyone wins!
You can repeat or replicate the president’s kaizen approach even if you don’t have a structure with a lot of presidents. A bunch of plant managers and functional department heads will work fine. If you are a hospital, pick a project and staff the kaizen with a cross-functional team from various silos. Always keep in mind that to be successful with lean, senior management must drive the change. You can’t delegate this one. Your leaders have to understand the power of lean and kaizen. As lean is “learn by doing,” the president’s kaizen model is an excellent way to do this. Kaizen, kaizen, kaizen!