The lean manager is a book about the manager of a car factory in France. His company has just gone through a takeover and the new CEO informs him he must close the factory. After begging the CEO agrees that if significant improvements are made to productivity, before the closure can be arranged(it’s France, labor laws are very complex), he may keep it open.
How is our hero to make these improvements at a factory that has been stagnating for so long?
Through the application of LEAN principles.
If you have worked in any manufacturing/tech industry jobs you will have heard the term LEAN. LEAN management was a system developed by Toyota that led to huge improvements in their productivity. This book is from the same family as the Phoenix project, which I wrote about here, a management book in the form of a novel. Like the Phoenix project, it is also a surprisingly good novel. A few empty characterizations aside the story was engaging and I found myself really hoping the factory would turn around and the jobs would be saved.
What is interesting from a management/LEAN point of view is in the book the factory already follows LEAN processes. They have a continuous-improvement officer and the main character has already gained various LEAN certifications. What the company CEO teaches the manager is there is a difference between the LEAN process, which is a prescriptive set of actions to apply and true LEAN working, which is more about educating employees to collectively solve problems.
The CEO’s first advice for improving the factory has 3 parts:
1: Fix quality problems
2: Reduce inventory to free up cash
3: Lower costs by eliminating waste found doing 1 and 2
From this advice the manager tries installing red bins at every point in the factory. When a part comes off a line in a defective state it is put in the red bin. Multiple times a day, inspections are made to check on the contents of the red bins. At first parts are put into the red bins, but this doesn’t feed through to improvements. Senior managers argue about the reason for different defects and nothing is really done.
This leads to next issue in order for people to solve problems there needs to be agreement on what the problem is. Only then can group problem solving begin. There can only be agreement on what the problem is, if these things are clearly tracked. This involved better monitoring and much more education of the workers in terms of what the quality standards were.
Once there was clear agreement on what the problem was and how progress could be tracked then they could start to look at which teams and people were the most productive and start to feed the improvements they had across the factory. This is where continuous improvement could start to happen.
To create a good product, you must have a good process. But a good process only comes from good people and having those people engaged with the process. The first step to improving your product is improving your people. Improving people is not simply a matter of sending existing employees on training courses or hiring new more qualified new staff. It is about building a culture of continuous improvement and collaboration where the best ideas from one employee are adapted by the rest of his team and then the rest of the company. A factory is not just about part flow, but also knowledge flow. To improve parts, improve people.
In trying to create such a culture the first problem encountered at the plant is that it is very hard for employees to work together to solve problem. People look to avoid blame. If something goes wrong, the warehouse will blame the engineers, who will blame the maintenance teams, and so on. In order to solve problems together the first barrier is there must be consensus on what the problem is. When there is a problem it must be stopped at source. A bad part must be caught at the place it is made and not become the part that caused the problem in a larger component.
This is why the pull system goes hand in hand with LEAN. The shorter work cycles in a pull system mean it is much easier to identify where the process goes wrong and get people together to fix it.
Kaizen is term used by Toyota. It roughly translates to change for better. But as applied by Toyota is a thing meet for. When engaged in Kaizen there is a checklist to go through:
- What is the problem we are trying to solve?
- What result do we expect?
- What principle should we apply?
- Did we get the result we wanted? Why? What did we learn?
The Toyota 4 obsessions
- Managing production sites through stable teams of multi-skilled workers
- Get everyone involved in quality
- Just in time process by reducing lead time
- All around cost reduction by eliminating waste
Another big theme in the book and a solution to so many problems is what they term “Go and see”. How do you get people to improve productivity? Go and see who is doing a good job and what they are doing. How do you reduce waste? Go and see what is being wasted. How do you get people to take responsibility for process? Go and see what they are worrying about. This really rang true to me, so much of what I’ve seen when I’ve worked at organizations with bad cultures is a lack of managers actually looking into what is going on.
The book makes clear the distinction between this and micro managing. Your not going in to fix the problem, you don’t need to have the solution to a waste or productivity issue. Your going in to listen and understand, to see why things aren’t happening and bring the right people together to solve the right problems. The Toyota way says that a manager should wash his hands 3 times every day, because every day he is going to the factory floor 3 times to see what is happening.