The Power of Problem-Solving

In June, The Management Brief began a two-month focus on problem-solving, examining this necessary element of continuous improvement from three perspectives: a lean expert and well-known author on the topic of problem-solving; an executive who oversees and supports a company’s daily management and problem-solving efforts; and a Toyota veteran and life-long learner and problem-solver.  

Problem-Solving Primer 

We kicked off the month with a thorough overview of the four basic types of problem-solving with Art Smalley, an expert in leadership, management, and the Toyota Way and author of Four Types of Problems. Josh Howell, LEI President, and I discussed with Art how the framework of the four types of problems relates to a lean management system, daily management, hoshin kanri, leadership, and culture. Art — who worked at Toyota in Japan, Donnelly in Michigan, and as a consultant with McKinsey & Co. — is uniquely qualified to address the complex, systematic intersection of these pieces.  

We spent considerable time discussing troubleshooting (type 1), the most frequently used (as much as 90% of problem-solving in some areas) and most misunderstood type, which is often confused with firefighting. “Obviously, there can be bad type 1, just dealing with symptoms, and there are good type 1, but understanding that spectrum is tough to explain to people who did not work in Toyota,” said Art. “Troubleshooting does have this negative connotation with it.” Art referred back to the original Japanese term for troubleshooting, which translates to “dealing with abnormalities.” A good troubleshooting environment involves attacking known problems with known solutions in real-time — often triggered by an andon, but not always — to get operations back to normal (i.e., how to mitigate issues that prevent achievement of near-term goals). 

We also reviewed troubleshooting’s relationship with the other types of problem-solving and the “flavors” of the three types — gap from standard (how to prevent a problem from recurring by eliminating its underlying root causes), target condition (kaizen to elevate the standard), and open-ended (innovations and breakthrough thinking). Art and I contrast how the different types presented themselves within Toyota in a plant setting (Art’s focus within Toyota, with heavy type 1 emphasis) compared to an executive/office setting (my background, in which type 2, 3, and 4 was more prevalent). “The context of where you are, what you’re doing, absolutely matters on this topic,” said Art. 

Management System Surfaces Problems 

Problem-solving’s relationship to a performance management system and daily management was a focus of Josh’s discussion with Jill Miller, Manager for Global Learning and Development at MillerKnoll, a maker of office furniture, equipment, and home furnishings. Jill supports the development, use, and expansion of the MillerKnoll Performance System (MKPS), which is designed to meet customers’ needs by engaging and developing people to daily surface and solve problems. She said, “One of the most powerful things about MKPS is that it helps make problems visible every day, right where the work is happening.”  

“Leaders are expected to build systems that make problems visible, create a safe culture for people to speak up, and develop a structure where people are capable of solving problems,” she added. “I think that culture of mutual support and daily improvement is really what makes the technical system sustainable. And without it, the tools are just going to fall flat. But with it, you really get teamwork, real learning, and continuous growth.” 

Jill also addressed the need to develop a consistent problem-solving approach and behaviors among team leaders and frontline associates. She said the MKPS leadership team, operations leaders, and human resources group collectively guide a development program that employees have called “life changing,” altering who they are, how they think, how they see their roles, how they interact with people, and how they approach their careers.  

For companies trying to build a system like MKPS and the elements of daily management and problem-solving that go with it, Jill had ample to share based on the struggles and successes at MillerKnoll. One key piece of advice was to establish a model line to show how the system can work in your business and the impact it can have on the P&L. “When people can see how the model line functions — with the tools, with the behaviors, with the systems — it really helps them understand that … this actually does apply to us.”  

Jill encouraged companies to reinvest the gains from improvements back into their people. “You make those improvements, you capture that savings, and reinvest it, in part, back into [creating] new facilitators to help support the system and develop problem-solving capability across your organization. One of the things I think we have seen and get reinforced over and over again is when we tap into the energy and the creativity of our people, the possibilities are truly limitless.” 

A Personal Pursuit of Problem-Solving 

Sal Sanchez, a Toyota veteran and TPS coach with LEI, spoke with Josh and me about his learning and application of the Toyota Production System (TPS) and problem-solving throughout his career. After working as a grocery manager, he worked at New United Motor Manufacturing Inc. (NUMMI), the GM/Toyota joint venture, and continued with roles at Toyota North American headquarters, TSSC (Toyota Supplier Support Center, where he worked with me in the late-1990s), and Dana Corp.  

Sal said his father had worked at the GM plant in Fremont, CA, that was closed, and then was hired at NUMMI as a team leader and trained in Japan. The excitement expressed by his father about Toyota’s approach to problem-solving and the use of kaizen to address individual processes inspired Sal to quit his job as a grocery manager and willingly enter NUMMI at the lowest level (team member) in order to experience the work and culture his father described. That kicked off his passion for all things problem-solving and led to a role as a team leader supporting others with problem-solving issues that surfaced throughout the day, especially those triggered by the pull of an andon cord.  

Sal said that when an andon is pulled, solutions need to be applied quickly, but the andon is not what many perceive. The line is not necessarily stopped, but there is a sense of urgency created for team leaders to rapidly assist while team members have a brief window of opportunity to solve the problem on their own (essentially the time it takes for the product to move from a station where the problem occurred to the next station). Sal said the andon was frequently pulled where he worked, which was a good thing. “When I hear that cord I know people are notifying, looking, and thinking about quality.” This discussion reminded me that most companies often don’t focus on problems until they get big, which is unlike at Toyota where many little problems are being addressed minute to minute and day to day so that they don’t become big problems. 

While a team leader, Sal also sought to more deeply understand the problems team members were going through and learned this by doing the jobs they did and experiencing what they went through. This was a NUMMI/Toyota expectation, which “also earns the respect of team members; they understand that you understand their jobs,” said Sal. He also tried to anticipate andon pulls, based on what he was seeing and hearing on the line, and conducted problem-solving circles and trained others in their use.  

Sal recalled the teamwork and comradery that existed at NUMMI and the achievements that kept coming long after the GM/Toyota agreement was established. “When you worked there you didn’t feel like you were just there to build cars. You were there for your ideas and thinking and how to improve. They empowered you to make decisions, and that was exciting.” For those wanting to hear more about the unique success of the GM/Toyota joint venture, Josh recommended “NUMMI,” an episode that aired on This American Life in 2010 and was then updated in 2015. 

Sal discussed the mentors that have helped him during his career, including many Toyota executives and Gary Convis at Dana, which has enabled him to help many organizations apply TPS and TPS fundamentals such as problem-solving and daily management. He continues to find ideas to engage and empower team members, including basic problem-solving skills for frontline associates and giving team members trend charts and templates to support their problem-solving. These tools, like the FMDS (floor management display system) boards used at Toyota, help to connect team members’ problem-solving with daily management. The paper boards are filled out by group leaders, which then guide team leaders to go out and solve problems affecting their areas. As problems are solved and improvement takes place, it “builds confidence and motivates people to do more,” said Sal. 

The challenge for many companies with problem-solving, Sal added, is not recognizing a problem because it’s covered by inventory or resources and some people who are unwilling to show or share their problems. Organizations must be able to see the gap, even forcing it through tougher targets, such as changing a safety target from accidents to near-misses so as to spur problem-solving. And for leaders wanting to promote and advance problem-solving, they need to have first -hand experience with problem-solving, “going out and solving a problem that affects your area.” Leaders sometimes disrespect team leaders by not challenging them and giving them time to solve problems on their own, said Sal. “People are born problems solvers, and they want to help and improve.” 

As Sal works today with companies outside of Toyota trying to apply TPS and problem-solving, he encourages a focus on culture and developing people and frontline leaders — “invest in your people.” He also encourages a relentless and endless pursuit of problem-solving, believing that if you don’t use it you’ll lose it. “I make it a mission of mine to always have a problem to work on and to teach others.”  

Next Month 

The July releases of The Management Brief will continue to explore problem-solving, especially a look at how problem-solving occurs at a corporate/business level. 

The Management Brief is a weekly newsletter from the Lean Enterprise Institute that bridges the gap between theory and practice in lean management. Designed for leaders focused on long-term success, it delivers actionable insights, expert perspectives, and stories from real-world practitioners. Each edition explores the principles of lean management—strategy deployment (hoshin kanri), operational stability and continuous improvement (daily management), and problem-solving (A3)—while highlighting the critical role of leadership. Subscribe to join a growing community of leaders dedicated to creating organizations built for sustained excellence.