Principles of Lean

ENMA 6040: Lean Systems
Overview
The from
Toyota
Derived
Way
by
Jeffrey Liker
14 Management
Principles
from the Worlds
Greatest Manufacturer
Copyright 2010
All rights reserved
Mark Polczynski
mhp.techforge@gmail.
com
ENMA 6040: Principles of Lean
Disclaimer:
Roots of lean manufacturing are almost a hundred years old.
Concepts have evolved significantly over the decades.
Often associated with the Toyota Motor Corporation
Many documenters of The Toyota Way.
Many descriptions and analyses.
See, for example, Hino and others.
Liker is one of the best known and highly respected
documenters
(Liker seems to have invented the term lean).
Here, we will examine his 14 principles analysis as an
example
But many equally-valid descriptions exist.
There is no one right way to view lean, no Bible, Koran, etc.
Disclaimer Part 2:
Were going to go over lots of stuf
about lean real fast here.
The idea is to provide an initial introduction to terms and
concepts.
Well spend the rest of the semester fleshing this out.
Dont panic! It will all make sense 15 weeks from now!
Anyway, according to Liker
The Toyota Approach : 4Ps
Continuously
solving root
PROBLEMS
Add value to the
organization by
developing your
PEOPLE and
PARTNERS
The right PROCESS
will produce the right
results
Long Term PHILOSOPHY
Principles 12-14
Principles 9-11
Principles 2-8
Principle 1
Toyotas 14 Management Principles

1.
Base your management decisions on a long term philosophy, even at the expense of short
term financial goals.
2.
Create continuous process flow to bring problems to the surface.
3.
Use pull systems to avoid overproduction.
4.
Level out workload (heijunka).
5.
Build a culture of stopping to fix problems, to get quality right the first time.
6.
Standardized tasks are the foundation for continuous improvement and employee
empowerment
7.
Use visual controls so no problems are hidden.
8.
Use only reliable thoroughly tested technology that serves your people and processes.
9.
Grow leaders who thoroughly understand the work, live the philosophy, and teach it to others
10.
Develop exceptional people and teams who follow your companys philosophy
11.
Respect you extended network of partners and suppliers by challenging them improve
12.
Go and see for yourself to thoroughly understand the situation
13.
Make decisions slowly by consensus, thoroughly considering all options; implement decisions
rapidly
14.
Become a learning organization through relentless reflection (hansei) and continuous

improvement (kaizen)
Yet another disclaimer:

Lean is not a bag of tricks to be capriciously applied in a
piecemeal manner to instantly achieve world-class
performance.
Lean is a paradigm, that is, a world view,
or way of thinking about system that
can benefit from judicious and
Continuously
well-planned application of
solving root
appropriate techniques that
PROBLEMS
support the lean paradigm.
But most of this
course focuses
here.
In other words:
This is
IMPORTANT!
Add value to the

organization by
developing your
PEOPLE and PARTNERS
The right PROCESS will

produce the right
results
A final disclaimer (promise!)

As we go through these points,
you might find yourself saying:
My organization could never do this!
Well, lean is not for every organization.
So, should you transfer out of this course?
Later we will talk about how to begin to eat the lean elephant.
Also, you can reflect on each of these principles in terms of
your own life.
Living lean is not a bad personal goal.
OK already! Lets go through the principles!
Continuously
solving root
PROBLEMS
Principles 12-14
Add value to the

organization by
developing your
PEOPLE and PARTNERS
Principles 9-11

produce the right
results
Principles 2-8
Principle 1
Principle 1: Base management decisions on long

term philosophy, even at the expense of short term
financial goals.
Have a sense of purpose that supersedes any short term

decision making. Align the organization toward a purpose
greater than making money. Understand your place in
the history of the company and work to bring the
company to the next level.
Generate value for the customer, society and the

economy. Evaluate every function in the company in
terms of its ability to generate value:
Is what I am doing right now adding value?
Be responsible. Strive to decide your own fate. Act with

self reliance and trust in your own abilities. Accept
ENMA 6040: Principles
Lean
responsibility for your conduct
andof maintain
and improve
the skills that enable you to add value.
Continuously
solving root
PROBLEMS
Principles 12-14
Add value to the

organization by
developing your
PEOPLE and PARTNERS
Principles 9-11

produce the right
results
Principles 2-8
Principle 1
10
Principle 2: Create continuous process flow to bring

problems to the surface.
Remember
this!
Redesign processes to achieve continuous flow.
Create flow to move material and information fast.
Link processes and people (autonomation) so problems

surface right away.
Make flow obvious throughout your organizational culture.

The Toyota Way case study Navy yard job
summaries:
Lead time reduced 63%
Distance paperwork traveled reduced 5592%
Number of steps reduced by 67%

ENMA 6040: Principles
of Lean
Handofs reduced
by 80%
11
Principle 3: Use pull systems to avoid

overproduction.
Provide downstream customers in the process with what

they want, when they want it, and in the amount that they
want.
Toyota studied US supermarkets in the 50s.
Pull vs. Push

Material replenishment initiated by consumption is the
basis for
just-in-time.
Just-in Time - an organized system of inventory bufers.
Examples- filling your gas tank, office supplies.
Flow (one piece) wherever you can and pull when you
must.

Scheduling still happens,
but keep it short (hours or days
vs. months).
12
Principle 4: Level out workload (heijunka).

Uneven workload is one element of waste:
Muda (waste)
Transportation, Inventory, Movement, Waiting,

Overproduction, Overprocessing, Defects
Muri (overwork)
Mura (unevenness)
Heijunka (evenness)
The Toyota Way case study- Gutter
manufacturer:
Lead time reduced by 40%
Changeover time reduced by 70%
WIP reduced by 40%
Inventory obsolescence reduced

by 60%
13
Principle 5: Build a culture of stopping to fix

problems to get quality right the first time.
Quality at the source

Jidoka autonomation
Andon signal for help
Poke yoke mistake proofing
Administrative approaches standardized work and

checklists
Toyotas quality process:

Go and see
Understand the situation
Andon (stop the line)
One piece flow
Ask why 5 times
14
Principle 6: Standardized tasks are the foundation

for continuous improvement and employee
empowerment.
Standardized work is not the end result, the one best way,
it is the beginning of improvement.
Use stable, repeatable methods everywhere to maintain

the predictability, timing, and regular output of your
processes. It is the foundation of flow and pull.
Standardized work consists of three elements-
Takt time
Sequence of the process
Amount of stock on hand
Capture the accumulated learning about a process by

standardizing the current best practices. Allow creative and
individual expression to improve upon the standard; then
incorporate it into the new standard.
15
Principle 7: Use visual control so no problems are

hidden.
Visual Control The ability to see abnormalities at a

glance.
5S enables visual control

- Sort
-
Straighten
Shine
Standardize
Sustain
Process Control Boards (daily goals, takt rate,

manpower, current production status throughout the day)
Reduce your documents to one piece of paper whenever

possible, and then post them for everyone to see.
- e.g. A3 (11x17) Reports (Storyboards), A4 (8 x
11)next!
- 4-Quadrant reports.
16
Principle 8: Use only reliable thoroughly tested

technology that serves your people and processes.
Use technology to support people, not to replace people.
Conduct actual tests before adopting new technology in

business processes, manufacturing systems, or products.
Reject technologies that conflict with your culture or that

might disrupt stability, reliability, and predictability, but
Encourage people to consider new technologies when

looking into new approaches to work. Quickly implement
a thoroughly considered technology if it has been proven
in trials and it can improve the flow of your processes.
17
Continuously
solving root
PROBLEMS
Add value to the
organization by
developing your
PEOPLE and PARTNERS
produce the right
results
Principles 12-14
Principles 9-11
Principles 2-8
Principle 1
18
Principle 9: Grow leaders who thoroughly

understand the work, live the philosophy, and teach
it to others.
Grow leaders from within rather than buying them from

outside. This is an example of applying heijunka, or
constancy of purpose.
Leaders must be role models of the companys philosophy

and way of doing business.
A good leader must understand the daily work in great

detail so they can be the best teacher of your companys
philosophy.
Before we build cars, we build people.

19
Principle 10: Develop exceptional people and

teams who follow your companys philosophy.
Create a strong, stable culture in which company values

and beliefs are widely shared and lived out over a period of
many years.
Train exceptional individuals and teams to work within the

corporate philosophy to achieve exceptional results.
Balance teamwork and excellent individual work (this
course!).
Use cross functional teams (this course!) to improve

quality and productivity and enhance flow by solving
problems.
Make an ongoing efort to teach individuals how to work

together as team toward common goals. Teamwork is
something that has to be learned.
20
Principle 11: Respect your extended network of

partners and suppliers by challenging them to
improve.
Have respect for your partners and suppliers and treat

them as an extension of your company.
Challenge your partners to grow and develop. It shows

that you value them. Set challenging targets and assist
your partners in achieving them.
21
Continuously
solving root
PROBLEMS
Add value to the
organization by
developing your
PEOPLE and PARTNERS
produce the right
results
Principles 12-14
Principles 9-11
Principles 2-8
Principle 1
22
Principle 12: Go and see for yourself to

thoroughly understand the situation (this course!).
Genchi (actual location) genbutsu (actual material or

product)
also known as going to the gemba.
Siena chief engineer drives in 50 states, 13 provinces and

territories and Mexico. Improvements include turning radius,
wind stability, drift, cup holders and trays
Common sense will tell you the answer, but collecting data
and then understanding the facts will tell you whether your
common sense was correct.
The Ohno circle He asked an engineer to stand and observe

an operation for 8 hours!
The Geography of Thought: How Asians and Westerners

Think Diferently and Why by Richard Nisbett
Westerners see things
6040: relationships
Principles of Lean
Easterners see thingsENMA
and
23
Principle 13: Make decisions slowly by

consensus, thoroughly considering all options; then
implement decisions rapidly.
Given a year to implement a project
Western 3 months planning, 9 months implementing and

correcting.
Toyota 10 months planning, pilot, 1 month to implement

flawlessly.
Toyota decision making:
Find out what is really going on, including genchi genbutsu.
Understanding underlying causes that explain surface

appearances
asking Why? five times.
Broadly considering alternative solutions and developing a

detailed rationale for the preferred solution.
Building consensus within the team, including employees

and outside partners.
Nemawashi the process of discussing problems and
24
Principle 14: Become a learning organization

through relentless reflection (hansei) and continuous
improvement (kaizen)*.
Problem solving is 20% tools and 80% thinking.
Hansei loosely, reflection, or lessons learned:
Please do the hansei.
Feel sorry.
Create a plan to solve the problem.
Sincerely believe you will not make this mistake

again.
Without hansei, it is impossible to have kaizen.
Hansei kai reflection meetings.
No magic metrics.
* and enrolling in the MS-ENMA program!

25
Principle 14: Become a learning organization

through relentless reflection (hansei) and
continuous improvement (kaizen)
Many people are surprised when I give talks and tell
them that Toyota doesnt have a Six Sigma program. Six
Sigma is based on complex statistical analysis tools. People
want to know how Toyota achieves such high levels of quality
without the quality tools of Six Sigma. You can find an
example of every Six Sigma tool in use somewhere in Toyota
at some time. Yet most problems do not call for complex
statistical analysis, but instead require painstaking, detailed
problem solving. This requires a level of detailed thinking and
analysis that is all too absent from most companies in day-today activity. It is a matter of discipline, attitude, and culture.
Jefrey Liker
26
And now for the details
Continuously
solving root
PROBLEMS
Add value to the
organization by developing
your PEOPLE and
PARTNERS
produce the right results
27

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What are Toyota's 14 management principles?

What are Toyota's 14 management principles?

What is the difference between Western and Toyota approaches to decision making?

What is the difference between Western and Toyota approaches to decision making?

ENMA 6040: Lean Systems

ENMA 6040: Principles of Lean

There is no one right way to view lean, no Bible, Koran, etc.

The Toyota Approach : 4Ps

ENMA 6040: Principles of Lean

Toyotas 14 Management Principles

Create continuous process flow to bring problems to the surface.

Use pull systems to avoid overproduction.

Level out workload (heijunka).

Use visual controls so no problems are hidden.

Go and see for yourself to thoroughly understand the situation

Become a learning organization through relentless reflection (hansei) and continuous

Yet another disclaimer:

Add value to the

The right PROCESS will

A final disclaimer (promise!)

OK already! Lets go through the principles!

Add value to the

The right PROCESS will

ENMA 6040: Principles of Lean

Principle 1: Base management decisions on long

Have a sense of purpose that supersedes any short term

Generate value for the customer, society and the

Be responsible. Strive to decide your own fate. Act with

The Toyota Approach : 4Ps

Add value to the

The right PROCESS will

ENMA 6040: Principles of Lean

Principle 2: Create continuous process flow to bring

Redesign processes to achieve continuous flow.

Create flow to move material and information fast.

Link processes and people (autonomation) so problems

Make flow obvious throughout your organizational culture.

Lead time reduced 63%

Distance paperwork traveled reduced 5592%

Number of steps reduced by 67%

Principle 3: Use pull systems to avoid

Provide downstream customers in the process with what

Pull vs. Push

ENMA 6040: Principles of Lean

Principle 4: Level out workload (heijunka).

Transportation, Inventory, Movement, Waiting,

Lead time reduced by 40%

Changeover time reduced by 70%

WIP reduced by 40%

Inventory obsolescence reduced

Principle 5: Build a culture of stopping to fix

Quality at the source

Administrative approaches standardized work and

Toyotas quality process:

ENMA 6040: Principles of Lean

Principle 6: Standardized tasks are the foundation

Use stable, repeatable methods everywhere to maintain

Standardized work consists of three elements-

Sequence of the process

Amount of stock on hand