1. Lean Management and the Role of Lean LeadershipThe presentation will begin momentarily. Please make sure that your pop-up blocker is turned off to view todays full presentation.

2. James P. Womack John ShookLean Enterprise Institute Lean Enterprise InstituteFounder and ChairmanSenior Advisor 3. Webinar Housekeeping TipsDisable pop-up blockersAdjusting your volume: Use the slide at the top right of the question box Adjust within Windows Media Player or RealPlayer Adjust the master sound control on your system (in the control panel)Viewing slides Enlarge Print 4. Webinar Housekeeping TipsAsking questionsUse the question box in the lower left cornerSubmit questions as they occur to you bytyping in the box, then click submitQuestions will be answered during the Q&Asession at the end of the presentation. 5. Question and AnswerWe will do our best to answer as manyquestions as possible in the allotted time.Answers to the questions that we cannot get toduring the webinar will be answered on ourwebsite soon.We will notify you when they are available. 6. James P. Womack John ShookLean Enterprise Institute Lean Enterprise InstituteFounder and ChairmanSenior Advisor 7. Todays Speakers James P. Womack, Ph.D. - founder and chairman of the Lean Enterprise Institute, a nonprofit training, publishing, and research organization founded in 1997 to help companies create value and eliminate waste.Co-author of:The Machine That Changed the World (Macmillan/Rawson Associates, 1990)Lean Thinking (Simon & Schuster, 1996)Seeing The Whole: mapping the extended value stream (Lean EnterpriseInstitute, 2001)Lean Solutions (Simon & Schuster, 2005) 8. Every Organization Must Address Purpose Provide value to customers in orderto prosper. Process Through smoothly flowing valuestreams for design, make, and use. People By engaging every employeetouching value streams (including supportstreams) to sustain and improve the flow. 9. Most Organizations Struggle Purpose is not clearly defined in terms ofsolving the customers problems. Processes are not clearly specified. People are not engaged in optimizing thewhole value stream rather than the point wherethey work. 10. Lean Management Addresses the purpose problem by identifyingproduct family value streams for specificcustomers:Makes value easier to specify.Makes the flow of value easier to see. 11. Lean Management Addresses the process problem by assigninga leader to each value stream: Makes current condition of entire processclear to everyone.Proposes a better future state process andtakes responsibility for implementing it.Makes condition of the new current stateclear to everyone. Proposes a still better future state. Etc. 12. Vertical Versus Horizontal Most organizations place the organizationchart and assets in the foreground:Managers think vertically to optimize theirarea, department, or function.Horizontal flow of value to customer easilygets lost. 13. Horizontal Versus Vertical Lean management places the horizontal flowof value in the foreground:Lean managers think horizontally, with thehelp of value stream leaders. HoweverFunctions are still strong (or even stronger): Repositories of deep technical knowledge Home base for employees Guardians of career paths 14. During Lean Transformation Some organizations:Create dedicated product/value-stream teams.Dramatically lessen role of their functions. Other organizations (including Toyota): Create strong horizontal advocates for product(e.g., Toyota chief engineer.)Create even stronger functions, focusing onknowledge capture and career paths. 15. The Matrix Problem If the primary focus in a lean organization is thehorizontal flow of value, as overseen by aresponsible person, yet there are strongfunctions... How do those doing the actual work in thefunctions avoid the dreaded two boss problem? By negotiations between the value streamleader and the function ahead about what isneeded from the function to support the product.The employee has only one boss: the functionhead. 16. Lean ThinkingFive 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.Buthow do lean leaders lead this process? 17. James P. Womack John ShookLean Enterprise Institute Lean Enterprise InstituteFounder and ChairmanSenior Advisor 18. Todays SpeakersJohn Shook- senior advisor to the Lean Enterprise Institute;learned lean while working for ten years at Toyota,helping to transfer its production, engineering, andmanagement systems from Japan to overseasaffiliates and suppliers. first American employee at Toyotas headquarters in Toyota City, Japan first American kacho (manager) at Toyota Japan former deputy general manager of the Toyota Supplier Support Center former director of the University of Michigans Japan TechnologyManagement Program co-author of Learning to See (Lean Enterprise Institute, 1999) 19. First, a note onWhat is Lean?Narrow definition tools cost cuttingBroader definition thinking, systematic entire enterprise, business system 20. Second, a note on What is Leadership?Peter Drucker on Leadership:The greatest leaders of the 20thcentury were Hitler, Stalin and Mao:If that is leadership, I want nothingto do with it. 21. The leaders job at ToyotaFirst, get each person to takeinitiative to solve problems andimprove his or her job.Second, ensure that each personsjob is aligned to provide value for thecustomer and prosperity for thecompany. 22. The Toyota Production SystemGraphics slide. Place graphic within the white box.Best Quality - Lowest Cost - Shortest Lead Time Through Shortening the Production Flow By Eliminating WasteJust in TimeJidokaThe right part Built-in Qualityat the right timein the right amount Automatic Machine Stop Fixed Position Line Stop Error Proofing Continuous Flow Visual Control Pull System Labor-Machine Efficiency Takt TimeProduction LinesThat Stop for HEIJUNKAAbnormalitiesStandardized Work and KaizenMutual Trust; Employee Development Robust Products and ProcessesStability; TPM; 5S Supplier Involvement 23. Graphics slide. Place graphic within the white box. 24. Kan Higashi to Gary Convis(NUMMIs senior Japanese and seniorAmerican leaders)Lead the organization as if you have nopower." 25. The Leaders job is to develop his or her peopleSPIRIT of Lean Mentorship:If the learner hasnt learned, the teacher hasnt taught 26. Extensive Support and Coaching at theFront Lines of the Organization SuperintendentGroup LeadersTeam &Team Leader 27. Leadership:Three ModelsOld Dictator Style:Do it my way1980s Empowerment Style: Do it your way... Lean Style:Follow me and lets figure this out together 28. Leadership at Toyota-From managing numbers to managing the processLeaders at Toyota, like leaders anywhere, want to seemeasurable results.But they know that the financial result is a result of aprocess.They also realize that the financial results reflect thepast performance of that process.Far better is to create a process that can be managedright NOW. 29. Leadership at Toyota-From the Five Whos to the Five WhysGood Toyota leaders dont 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, avoidingfinger-pointing seeking of where to place the blame.It also keeps responsibility with the person who is doing thework,This is what truly engages and empowers the workforce. 30. Leadership at ToyotaFrom Problem-hiding to Problem-solvingAll actions at Toyota revolve around planning and problem-solving.It is assumed that there will be problems, that everything willnot go according to plan.No problem is problem.For the system to work, problems must be exposed and dealtwith forthrightly.Hiding problems will undermine the system. 31. Leadership at ToyotaControl with FlexibilityToyotas 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. 32. Leadership at ToyotaP-D-C-AToyota would say this is essentially the P-D-C-Amanagement cycle they learned from Dr. Deming.Yet, my own observations say this is precisely the thingthat most companies cant seem to do.Why?Surely one major reason for this is the way we lead andmanage. 33. P-D-C-A Cycle GRASP the SITUATION HYPOTHESISADJUSTACTION PLANCHECKSTUDYDOTRYREFLECT 34. Lean LeadershipThe Lean Leader leads a very differentway:It is as different from the commonly accepted notion of the enlightened modern manager as it is the old command and control dictator. 35. Sr.Mgmt. System Kaizen Eliminate Muri and MuraMiddleMgmt.Process-step KaizenEliminate MudaFrontLines FOCUS 36. Problem and PDCA Tools for different levels RoleImpactMUST PROVIDE VISIONSENIORLikes the resultsAND INCENTIVEMANAGEMENTMUST LEAD THE ACTUAL MIDDLELeft with changed,OPERATIONAL CHANGE MANAGEMENTuncertain roleLikesMUST DOFRONT LINES the involvementA Difficult Struggle at the Mid-managementand First Line Supervisory Level 37. Problem and PDCA Tools for different levels RoleProblem:Impact MURA & MURIMUST PROVIDE VISIONSENIOR Likes the resultsAND INCENTIVEMANAGEMENT Problem:MUST LEAD THE ACTUAL MURA & MURI MIDDLELeft with changed,OPERATIONAL CHANGE MANAGEMENTuncertain roleProblem:MUDALikesMUST DOFRONT LINES the involvementA Difficult Struggle at the Mid-managementand First Line Supervisory Level 38. Problem and PDCA Tools for different levelsPDCA tool: Role Policy Management Problem:ImpactMURA & MURAMUST PROVIDE VISIONAND INCENTIVE PDCA tool: SENIOR Likes the results MANAGEMENTA3 or VSMProblem:MUST LEAD THE ACTUAL MURA & MURI MIDDLE Left with changed,OPERATIONAL CHANGEMANAGEMENTuncertain rolePDCA tool:Problem:Standardized Work MUDA Likes MUST DO FRONT LINESthe involvementA Difficult Struggle at the Mid-managementand First Line Supervisory Level 39. Chairman Cho ofToyota:Three Keys toLean LeadershipGo See. Sr. Mgmt. must spend time on the plant floor.Ask Why. Use the Why? technique daily.Show Respect. Respect your people. 40. The Thinking Production System Getting peopleBest Quality - Lowest Cost - Shortest Lead Time to think and Through Shortening the Production Flow By Eliminating WasteJust in Time take initiativeJidokaThe right partisBuilt-in key! the Qualityat the right timein the right amountAutomatic Machine StopFixed Position Line Stop Continuous FlowError Proofing Pull SystemVisual Control Takt TimeLabor-Machine Efficiency Production Lines HEIJUNKAThat Stop for AbnormalitiesStandardized Work and KaizenMutual Trust; Employee Development Robust Products and ProcessesStability; TPM; 5S Supplier Involvement 41. Learning and mistakesThere are sometimes too many nay-sayers. In the early days of TPS we wereable to just try things, to make mistakesand learn from them. Thats the spirit weneed.Mr. N. HayashiFormer general manager of Toyotas TPS Office 42. Learning and mistakesContinuous improvement comes frommaking mistakes and learning from them."Cheryl Jones, Toyota Group LeaderHilly Krystal gave us a place to try andfail.Patti Smith 43. Learning and mistakesIt is a mistake to suppose that men succeedthrough success; they much oftener succeedthrough failures. Precept, study, advice, andexample could never have taught them so wellas failure has done.Samuel SmilesBritish author of Self Help(favorite of Sakiichi Toyoda in late 1800s) 44. Questions & AnswersJames P. Womack John ShookLean Enterprise Institute Lean Enterprise InstituteFounder and ChairmanSenior Advisor 45. Lean EventsFebruary 28th to March 1stLean Transformation SummitJoin the Lean Community at the Grand Hyatt, Atlanta,GA, for the first annual Lean Transformation Summitsponsored by the Lean Enterprise Institute.For more details visit: www.lean.org 46. LEI BookstoreThe Lean Enterprise Institute has a largeselection of lean publications and learningmaterials available for sale in our bookstore.Visit www.lean.org to learn more.