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What Exactly Is - or Isn't - a Lean System?

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Dear Gemba Coach,

I’m confused as to what a “lean system” is or should be. Could you clarify?

Good question and not easy to answer as, as with many lean concepts, there is not one single answer and much depends of the perspective of the person answering. For instance, an executive vice president of Ford describes the Ford Production System as how Ford operates within all of its manufacturing facilities throughout the world:

“FPS is our blueprint for today and for the future,” said John Fleming, executive vice president, global manufacturing and labor affairs. “It’s about bringing processes together. It’s about learning from each other. And it’s about having operating systems developed from best practices from around the world which are truly the best way that we know how to build vehicles.”

“Having a standardized approach is very important because it provides a baseline on which to build and improve. Without that, we know we won’t be successful,” he said. “And although we have operated in different ways around the world in the past, our teams recognize the benefit of having a structured standard that’s integrated together and works as a system.” (See: http://www.at.ford.com/news/cn/Pages/Ford%20Production%20System%20drives%20success%20at%20Ford%20Motor%20Company.aspx)

Toyota presents the Toyota Production System differently:

A production system which is steeped in the philosophy of "the complete elimination of all waste" imbuing all aspects of production in pursuit of the most efficient methods. Toyota Motor Corporation's vehicle production system is a way of "making things" that is sometimes referred to as a "lean manufacturing system" or a "just-in-time (JIT) system," and has come to be well known and studied worldwide. This production control system has been established based on many years of continuous improvements, with the objective of "making the vehicles ordered by customers in the quickest and most efficient way, in order to deliver the vehicles as quickly as possible."

The Toyota Production System (TPS) was established based on two concepts: The first is called "jidoka" (which can be loosely translated as "automation with a human touch") which means that when a problem occurs, the equipment stops immediately, preventing defective products from being produced; The second is the concept of "just-in-time," in which each process produces only what is needed by the next process in a continuous flow. (See: https://global.toyota/en/company/vision-and-philosophy/production-system/)

So, What Is a Lean System?

So is it a system of best practices standardized around the world, or is it a philosophy of the complete elimination of waste? In his introduction to the first booklet on TPS, Taiichi Ohno presents the system differently again as “a series of related activities aimed at elimination of waste in order to reduce cost, improve quality, and improve productivity.” (Art Smalley’s translation of the first TPS manual in 1973)

Then, in the old days, before it got its name, the Toyota Production System was known as the kanban system – no more than a tool box? What is a lean system?

A system is officially a set of interacting or interdependent components forming an integrated whole through the relationships between the elements. What are the elements? What are the parts? A system is also an organized or established procedure to do something, such as a system to beat the roulette, or your system to handle your e-mails.

If we look at how the TPS came to be, we can see all these various strands come together.

At the turn of the 20th century, Sakichi Toyoda first invented a way to have automatic looms stop by themselves when a thread of cotton broke, so as not to produce reams of defective material. This is a clear element of the system: ways to stop rather than continue to produce when something is out of kilter.

Taiichi Ohno, in the 1920s was working in Toyoda Looms and involved with the efficiency movement sponsored by the Japanese government of the time. They realized that using the jidoka techniques developed by the founder, they could make massive productivity gains because no one needed to babysit the machine to make sure it operated correctly, and one operator could now run several machines. They had, at the time, no concept of flow.

Which is what Kiichiro Toyoda invented when he realized the inefficiency of having unneeded parts lying all around the factory and, right before WWII, he produced a manual on how to control production “just-in-time”, a phrase he coined in English and that Taiichi Ohno explained as, rather, exactly on time. He tinkered with this idea before all experiments were stopped when the military took control of the plants during the war.

The Lean Elements Come Together

In the dreadful struggles of the post war years,  Ohno put two of the elements together through the use of kanban and the supermarket concept. As he describes in his books he hit upon the labor saving potential of working at takt time and producing according to kanban, hence the seven classic labor “wastes”, which are useless operations created by NOT being just in time: overproduction, inventory, overprocessing, motion, transportation, waiting, defects.

Here we can see the relationship between just in time and labor productivity. Then, as Toyota embarked on its total quality crusade, it emerged that kanban couldn’t function with bad parts in the supermarkets, and hence a further element connected. Now we see the relationship between just in time, quality and labor productivity.

Getting closer to one piece flow generates higher productivity, but requires better quality. However, getting closer to one piece flow is also the key to greater quality as it allows operators to inspect parts one by one, and so on.

Early in the fifties, Eiji Toyoda visited Ford factories and was struck by suggestion system. Ford sought “great ideas”, but Eiji Toyoda saw it as a way to involve operators into thinking about kaizen. In the same period, TWI in Japan insisted through the Job Methods course in distinguishing between value added and non-value added parts of the process. We now have a third element integrating itself: standardized work/kaizen.

I’m not saying this is a historical sequence. Rather, during these formative decades, these were the problems Toyota’s production management teams had set for themselves, and in working through them, they came up with a set of principles to help learn how to increase quality, lower costs, reduce lead-time and involve team members in daily kaizen. It’s a system because these core principles feed into each other and don’t make much practical sense taken piece meal.

But what about the whole “best practice” and “standardization” idea of the Ford outlook on systems? The earliest use of “system” I’ve come across of dates back to Frederick Winslow Taylor. His take on work was that great made needed to be made rather than found, which required a system of training to best practices:

“In the past the prevailing idea has been well expressed in the saying that ‘Captains of industry are born, not made’ and the theory has been that if one could get the right man, methods could be safely left to him. In the future it will be appreciated that our leaders must be trained right as well as born right, and that no great man can (with the old system of personal management) hope to compete with a number of ordinary men who have been properly organized so as efficiently to cooperate.

In the past the man has been first; in the future the system must be first. This in no sense, however, implies that great men are not needed. On the contrary, the first object of any good system must be that of developing first-class men; and under systematic management the best man rises to the top more certainly and more rapidly than ever before.” (Principles of Scientific Management, pg. 2)

In Taylor’s terms, “best management is a true science, resting upon clearly defined laws, rules, and principles, as a foundation.” Taylor’s brilliant idea was to have engineers define best practice, and then train all others to apply these best practices.

Yin and Yang

The confusion about systems is understandable because it is a case of emphasis more than nature. In both the Taylor/Ford and the Toyota systems we find a set of typical problems and typical solutions. The Taylor/Ford approach emphasizes the typical solutions – one should identify the best solutions and then standardize them across operations by using the “system” to teach these best practices to everybody.

Conversely, Toyota’s emphasis in on the typical problems – the system’s point is to teach everybody to recognize typical problems and to work out their own solutions to the problem, and so, develop a greater understanding of their work, with a side benefit of capturing more creativity and engagement.

The main point here is that both approaches are valid, but partial. For instance action learning theory describes learning as:

Learning = programmed learning + insight questioning

So the “apply best practice” and “do kaizen to figure out” approaches are not mutually exclusive, and indeed, the most effective system has to be something of both.

To answer your question then, a production system is a set of interrelated “typical problems/typical solutions” to teach employees to perform better at their jobs. The confusion about what systems are mostly comes from different interpretations by different people on whether to “apply the system of best practices to every person until they perform in a standardized way” or to “develop every person by using the system to help them understand and solve their own problems.”

This is not black-and-white. Ford has certainly integrated learning in much of its lean thinking. Toyota is not averse to standardizing approaches as it did with the “Toyota Business Practices” that standardize its problem solving methodology. In the end it all comes down to what problem you’re trying to solve. You can come up with either:

  1. A system of learning activities so that people understand interconnected and interdependent problems better and learn to solve them better;
  2. A system of standard practices to provide a common baseline to all in the organization for people to come together and learn from each other;
  3. A system of tools to optimize local situations and improve operations point by point.

It’s a yin and yang thing – none of the above are mutually exclusive and, indeed, an ideal lean system would have some aspects of the three. However, beware of taking any one of these meanings to extremes, dismissing the other two – that is a well known way of getting into trouble.

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