2020-07-19 09:25:00 Sun ET
distinctive capabilities value creation service innovations competitive advantages team leaders specialists advisors iterative continuous improvements senior managers core competences core business operations seamless systems blue ocean seamless integration lean solutions minimum viable products lean production lean consumption continuous flow toyota product differentiation cost leadership
Senior business leaders can learn much from the lean production system with iterative continuous improvements at Toyota.
Takehiko Harada (2015)
Lean values and principles arise from the Toyota production system that Japanese senior engineer Taiichi Ohno gradually built in the post-war decades. The 15 main management lessons help senior business leaders, middle managers, and several other team members reduce waste in order to create the continuous flow of small batches of lean production with iterative continuous improvements over time. This lean approach helps most team members achieve the product-market fit, a delicate balance between work-life quality and employee motivation, and greater alignment between lean business processes and core value streams (the latter of which often cater to the essential customer needs and wants).
The lean CEO is the top executive manager who molds, changes, and then refines the organizational rules, functions, and key business operations. In a lean business environment, this top executive manager builds a solid and robust communication pipeline to most team members for better productivity. Senior business managers must learn to delegate critical tasks to subject matter experts by transferring major authority to the departmental supervisors. This delegation helps foster mutual trust, respect, recognition, and motivation for most team members. This mutual trust can effectively contribute to greater transparency and better regulation over time.
Specific challenges arise from the executive oversight of core business operations in foreign countries. Senior executive managers must learn the local cultures and customs with sufficient reliance on local middle managers and core team members as much as possible to integrate lean startup methods into their business functions. When push comes to shove, it is important for senior business leaders to promote better alignment between foreign value streams and lean business processes.
Senior business leaders can learn lean lessons from the Toyota production system.
The ingenious insight of Taiichi Ohno focuses on the continuous flow of both small parts and components to holistic products (or Toyota cars) with little waste of over-production. This one-piece flow becomes the Toyota production system in the lean business context. Senior business leaders can learn lean lessons from this Toyota production system:
The chief executive manager integrates several lean business endeavors with core value streams and distinctive capabilities.
The top management style and corporate culture must change for the better. The chief executive manager integrates most of the lean business processes with core value streams and distinctive capabilities. In this important way, the lean business approach differs much from the traditional management style of getting orders from senior executive committees.
The main organizational structure includes its rules, functions, and core business operations. Departmental functions designate what team members and individual contributors need to accomplish within reasonable time frames. Both functions and rules are critical business decisions on the standard work. Senior supervisors and team members carry out core business operations to pull together both individual contributions as well as collaborative efforts.
The lean CEO can change the corporate rules, functions, and business operations in response to external forces and circumstances. From time to time, such changes bring about iterative continuous improvements. The lean CEO needs to establish a robust direct communication pipeline from the key business operations to the top management team. This positive communication helps ensure alignment between critical business operations and the top management team members (who monitor delicate changes in both the external circumstances and customer demands).
Senior managers and other team members strive to sustain the continuous flow of small batches of lean production.
Both senior supervisors and team members should strive to sustain the continuous flow of small batches of lean production. These senior business leaders must build a sustainable organizational structure that empowers all team members to see how their core business operations contribute to the eventual fulfillment of bold strategic goals. Sometimes shorter-term tactical solutions help senior supervisors and most team members achieve the longer-term strategic goals in due course. In this light, senior managers and supervisors often must triangulate both business decisions and issues from alternative perspectives. For this reason, the senior management team should include top executive leaders with diverse analytic skills, backgrounds, and experiences. In essence, senior managers and supervisors need to delegate tasks well enough so that team members can carry out core business operations in accordance with the standard work priorities and long-term corporate strategies. When push comes to shove, the law of inadvertent consequences often counsels caution. Iterative continuous improvements become possible in this context.
Senior managers and supervisors cannot monitor the standard work on a continual basis. Instead, these senior managers and supervisors often need to facilitate the continuous flow of small batches of lean production. At the same time, these senior managers and supervisors need to identify new business opportunities for iterative continuous enhancements such that core business operations can change for the better. Senior managers should delegate proper authority to both supervisors and most team members to ensure relentless standardization. In-depth standards help minimize the chances of technical mistakes, setbacks, abnormalities, and so forth. The bilateral communication between senior managers and team members helps ensure better alignment between lean business processes and long-term strategic goals. In this important way, senior managers can diagnose proper solutions (but not quick fixes) in order to resolve the root causes of recurrent technical issues.
Moreover, good business leaders must often recognize the collaborative efforts of both team members and individual contributors. This recognition helps boost team morale and employee motivation. All the team members and individual contributors should be able to see the immediate results and rewards of the standard work. All team members should further feel the eventual results of positive changes that can boost output gains per unit of input factors. Iterative continuous improvements can become part of core business processes over time. These iterative improvements are both short-term tactical solutions as well as medium-term strategic solutions at the heart of lean business production.
Senior managers and key team members must adapt foreign business operations to the local cultures and customs.
Senior managers who head core business operations in a foreign country may face specific challenges. When these managers find out their international assignments, these senior executive managers should take time to visit the core business men or women who led business operations in that foreign country. This communication can allow senior managers to acquire valuable information about the local cultures, customs, rules, laws, consumer tastes, habits, lifestyles, preferences, and so forth.
From time to time, these senior managers may fall into the trap of misconceptions about foreign business operations. Many missions that senior managers may view as difficult may turn out to be quite easy, whereas, many other missions that senior managers may view as easy may turn out to be difficult or virtually impossible. For this reason, it is paramount for these senior managers to talk with their local team members to better assess difficulty levels before these managers undertake major changes in foreign business operations.
In foreign business operations, senior managers need to cultivate a healthy team environment where it is okay for team members to say sorry. Team members must be able to admit mistakes, setbacks, and disappointments with no adverse career consequences. Otherwise, some team members would choose to cover up errors at work. Senior managers must remain true and authentic to themselves and their subordinates in foreign business operations. When new issues and obstacles arise from the broader business context, senior managers would be able to work closely with their local team members to find the root causes of specific technical problems. In this unique fashion, these senior managers and local team members can better diagnose proper solutions that rectify the fundamental flaws for good. Therefore, it is important for these senior managers to focus on the root analysis of the problem rather than the literal words of the apology.
Senior managers must find suitable local middle managers to work with upstream suppliers. These local middle managers can gradually mold specific suppliers into key lean production partners. In a delicate way, these local middle managers can train most upstream suppliers to learn the continuous flow of small batches of lean production. If senior managers select multiple local middle managers, these multi-trainers may inadvertently exhibit differences in the style and substantive content of communication with upstream suppliers. Sometimes such differences can cause unnecessary confusion.
These local middle managers hence serve as upstream supplier-trainers in charge of several companies. These trainers need to visit the respective suppliers at least once per month. During these regular visits, the trainers get to know the pervasive issues of core upstream suppliers, report these issues to senior managers, receive instructions on what can constitute proper solutions, and then deploy these proper solutions at the supplier sites in accordance with the standard work priorities and longer-term strategic goals. At least once per quarter, senior managers should go with the local trainers to verify the current progression of upstream supply chains. In fact, it is quick and effective for senior managers to localize all middle managers and supplier-trainers to encourage better collaborative efforts.
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