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Taiichi Ohno: Lean Production

The engineer behind many aspects of the Toyota Production System (TPS) can justly be described as instrumental in creating one of the world’s great manufacturing businesses. But his influence goes far wider, with many of the management ideas that we take for granted originating as a part of the TPS. I promised you we’d look at him when we examined the lessons from his boss, Eiji Toyoda, so let’s see what we can learn from Taiichi Ohno.

Taiichi Ohno

 

Short Biography

Taiichi Ohno was born in China, where his father was working on the Manchuria Railway, in 1912, and grew up in the Aichi prefecture of Japan, attending the Nagoya technical High School. In 1932, he joined the Toyoda Automatic Loom Works, which had been established by Sakichi Toyoda, who was highly innovative in the looms he designed and built. When Toyoda sold off the loom business to a British company, he determined to invest the money in an automobile business, to be headed by his son, Kiichiro Toyoda.

Kiichiro Toyoda set out to learn from US motor manufacturers, and started manufacturing vehicles in 1936 and it was he who first introduced the idea of ‘Just in Time’. However, it was when Taiichi Ohno was tasked with increasing productivity that the company started to make the breakthroughs which would later form the groundwork for Toyota’s great commercial achievements of the 1960s onwards, under Eiji Toyoda.

In looking at Toyota’s productivity levels shortly after the war, Ohno realised that the gap in performance between Toyota and the top US manufacturers of a factor ten could not be due solely to a poor Japanese workforce. He considered that the significant factor was waste; ‘Muda’. As he experimented, and took on board Kiichiro Toyoda’s ideas of Just in Time production, he gradually, over the years from 1945 to the mid-1970s, built up a coherent set of principles and practices that has come to be known as the ‘Toyota Production System’.

Towards the end of his life, Ohno spoke and wrote extensively (most notably: ‘Toyota Production System: Beyond Large-Scale Production‘) about the TPS – perhaps more than his superiors really felt comfortable with. In doing so, he frequently used the metaphor of a supermarket to describe how Just in Time principles work. He had first seen, and been captivated by, supermarkets on a visit to the United States in 1956. Ohno died of heart failure in May 1990.

The Toyota Production System

The three principles at the heart of the the Toyota Production System are easy to state:

  1. Produce components just in time for their use (‘Just in Time’ production)
  2. Build quality in every part of the process (‘Jidoka’)
  3. Create one continuous process (the ‘Value Stream’)

Just in Time Production

As if the phrase Just in Time has not become well-enough known, it is supported by an idea and a practical tool that have each become central to manufacturing processes world-wide… and, indeed, to other business and organisational processes.

The first of these – and Ohno’s starting point for his reforms – is the idea of waste, or ‘Muda’. Ohno waged a systematic campaign to eliminate all possible forms of waste. In so doing, he identified the seven categories that are often known as the ‘Seven Wastes’.

  1. Defective Production – producing defective products
  2. Overproduction – producing more than is needed
  3. Waiting – idle, non-productive time
  4. Transporting – the wasted time and risks of damage or loss
  5. Inventory – holding unnecessary stock and therefore incurring capital costs
  6. Motion – the wear and tear and the accidents that arise in moving things around a plant
  7. Excessive Processing – over-specification of components, or unwanted functionality, for example

Some people add other wastes to Ohno’s original seven, most commonly placing Non-used employee talent (wasting skills) between number 3 and 4 in my ordering, so create the mnemonic acronym: DOWNTIME.

Ohno also developed a system of signboards that track progress of goods through the manufacturing process, which are called ‘Kanbans’. The kanban board is now widely used to track progress in projects throughout commerce, especially in managing software projects under agile project management methodologies.

Quality

Ohno examined every part of the manufacturing process and looked for ways to reduce errors, increase safety, and improve reliability. When he found them, he instituted rigorous staff training. The principle of building quality into everything is ‘Jidoka’. And, although he did not originate the idea of continuous improvement, known as ‘Kaizen’, Ohno’s concept of Jidoka involved daily improvement in a cycle of detecting problems, stopping production, removing the cause of the problem, and then incorporating the improvements into the standard workflow.

Another of Ohno’s greatest innovations is his problem solving methodology, the Five Whys, a way of getting at the root cause of a problem. This intelligent approach to stopping a machine when a fault arises and injecting human problem solving is Ohno’s idea of intelligent automation, or ‘autonomation’; ‘ninben no tsuita jidoka’.

Value Stream

Instead of seeing a factory as a series of inter-connected processes as Henry Ford had done, Ohno saw it as one continuous connected process. And ensuring that its efficiency is optimised is the idea of work levelling; ‘Heijunka’. This is central to eliminating waste, or Muda and is about rearranging (dynamically) the allocation of work to ensure that every resource is fully utilised at all times.

Introducing Change

Many of Ohno’s ideas seem obvious to us now but they did not at the time. And, inevitably, he encountered much resistance from the Toyota workforce. He employed one principal strategy to deal with this, that had two simple components: patience and persistence. Evolving the Toyota Production System took thirty years and, no doubt, it is ongoing today.

Adoption outside of Japan

Outside of Japan, Ohno’s ideas have been widely adopted and modified. The TPS is now more generally known as ‘lean manufacturing’ and the principles of lean thinking are increasingly being applied throughout the economy in sectors like retailing, services, telecommunications and even government service.

There does seem to be a difference, however, between Ohno’s and the two Toyodas’ philosophy and that of modern western businesses with which I am familiar. Here, we see organisations seeking to use lean principles to ‘sweat their assets’ to cut staff numbers and compel them to work harder to achieve greater productivity with fewer resources. Toyota instead thought that by making its process more efficient, its workforce could produce more without significant increases in the cost base, and so exploit new markets to create more profit.

At the heart of this is a different approach to pricing. The Western approach is to lower your cost base as low as you can, to determine a profit level, and then to sell at the price that these dictate.

'Typical' Western approach to pricing

Toyota’s success was build on a different philosophy: that the market fixes the price it will pay, and you optimise your processes to set your unit costs. Your profit is the difference.

'Successful' Toyota approach to pricing

Learn More

Toyota describes the Toyota Production System on their website, at: http://www.toyota-global.com/company/vision_philosophy/toyota_production_system/

 

 

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Resistance to Change

The Management Pocketbooks Pocket Correspondence Course

This is part of an extended management course. You can dip into it, or follow the course from the start. If you do that, you may want a course notebook, for the exercises and any notes you want to make.


In the last couple of blogs, we have taken a look at how organisational change works in three phases, and how people respond to change. In this blog, we’ll focus on the ways in which people resist change and how you, as a manager, can deal with resistance.

Resistance is an inevitable part of people’s response to change and there are many reasons why people resist change. Dealing respectfully with that resistance requires that you can interpret the nature and reasons for the resistance, so the first skill to deploy will always be listening.

What you are listening for, will be clues as to what the source of the resistance is, so that you can address it properly. There are five levels of resistance, that lead to a simple, powerful model developed by Dr Mike Clayton (coincidentally, the author of this blog).

The Onion Model of Resistance

The Onion Model of Resistance

The Onion Model suggests five levels of resistance – each a little hotter and more emotionally charged than the last.

I don’t understand why we have to change

Resistance is often prompted by not recognising the need to change. People in organisations are usually only aware of pressures that impact upon them directly – leading them to say ‘we really must change this.’ But other pressures for change pass them by and it is therefore natural for them to question what they see as unnecessary change.

Address this form of resistance by showing why change is necessary

I don’t understand why this change

Even when people see the need for change, they also need to understand why you have chosen the response you have. You – or  another manager – have gone through a series of investigations and decisions to choose your response but others have been outside of that process and naturally wonder if there is a better way.

Address this form of resistance by showing why your response is the most appropriate one.

I don’t like this change

At times of change, people often focus on what they will lose, giving it more weight than the corresponding gains. This hard-wired ‘loss aversion’ is a powerful driver of resistance even when objectively, the loss is small and the benefit is great. People will also resist when objectively the loss to them outweighs the benefit, but here, there is nothing you can do aside from acknowledging, sympathising, and supporting your colleague.

Address perceived disadvantage by patiently demonstrating the benefit.

Another reason for this form of resistance is that people sometimes spot a flaw in your plan. They may be wrong or right, but you must listen and evaluate carefully, and be prepared to make changes if you conclude that your changes are not the best you can make them.

I don’t like change

Change is a part of life that we all live with, but some have a greater tolerance than others. Those who feel they don’t like change are again focusing on what they fear losing, or simply on the fear that they will not be able to cope.

Address this form of resistance by offering support to help people overcome their fears and thrive in the new environment.

I don’t like you

This is rarely as personal as it sounds. In times of change, people lash out at whoever they can, as a way of exercising old frustrations and grievances, because the stresses of change add to the pressures they are under.

Accept a small amount of this only and address this as the inappropriate behaviour that it is. Use assertive behaviour and your other skills for dealing with difficult behaviour to deal with it in the first instance. If, on occasion, this is not enough, use your organisation’s formal procedures.

Further Reading 

  1. The Handling Resistance Pocketbook

Other Pocketblogs you might find helpful

  1. How to Manage a Challenging Conversation
  2. Listening
  3. I can’t do that now
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Scott and Jaffe: The Change Grid and How we Respond to Change

The Management Pocketbooks Pocket Correspondence Course

This is part of an extended management course. You can dip into it, or follow the course from the start. If you do that, you may want a course notebook, for the exercises and any notes you want to make.


Last week’s Pocket Correspondence Course module was about the three phases of creating change – or ‘transitions’, in Bridges’ language. This week, we need to address the question of how people respond to organisational change.

Have you ever noticed how people’s response to organisational change is sometimes out of proportion to the objective scale of the change itself? Organisational changes are hardly a matter of life and death, yet people often get scared, angry, upset or frustrated. These are powerful emotions that managers rarely feel ready to deal with.

While many managers see organisational change as someone else’s specialism – the HR team, or the consultants, for example – it is your team. A general overview will help you understand some of the dynamics you encounter. One of the most useful and compelling models is that developed by Cynthia Scott & Dennis Jaffe.

Grief: The work of Elisabeth Kübler-Ross

The Scott-Jaffe model owes much to the work of Dr Elisabeth Kübler-Ross. She researched the way people deal with tragedy, bereavement and grief, that led her to the development of a widely used description of grief as following five stages: denial, anger, bargaining, depression and acceptance – often remembered with the acronym DABDA.

Kubler-Ross Grief Model

The responses that Dr Kübler-Ross described served your ancient ancestors well. They did not emerge in an environment of shifting organisational structures and operational processes: the changes they encountered were often life threatening.

In modern times, we must use the same underlying physiology and brain chemistry to cope with both emotional trauma and an office move. It seems unsurprising, therefore, that when Scott and Jaffe researched responses to organisational change, they found a similar pattern.

Scott and Jaffe’s Four Stage Response to Change

Scott & Jaffe Change Grid

Scott and Jaffe’s model suggests that we move through four stages as we respond to organisational change. Clearly, if we quickly perceive the change as beneficial, we will jump from the first to the fourth.

Denial

Initially, the meaning of the change fails to sink in: we are happy enough (or at least comfortable) with the status quo, so our minds reject the reality of change. We act as if nothing has happened and Scott and Jaffe called this stage Denial.

Resistance

Once we start to recognise the reality of change, we start to Resist it. This arises from our aversion to loss – we focus on the elements of the status quo we will need to give up and our brains assign that a far greater weight of attention and value than any potential gains.

We do this first at the emotional level, showing anger, anxiety, bitterness or fear, for example, and later by opposing the change actively, engaging our critical faculties to find reasons to resist. Organisations see increases in absence, complaints and losses, and drops in efficiency, morale and quality.

Exploration

When managers like you face up to the resistance and engage with it in a respectful and positive way, people can start to focus on the future again. They will Explore the implications of the change for them and for their part in your organisation. They will look for ways to move forward. This can be a chaotic time, but also an exhilarating one – particularly when the benefits of the change are significant.

Commitment

Eventually people start to turn their attention outward as they Commit to the new future.

Other Models of Change

Scott and Jaffe are not the only researchers to articulate a model of organisational change. There are other, similar, models. Perhaps the best known of the three-phase models is Kurt Lewin’s ‘Freeze Phases that we covered in the previous Management Pocketblog: Unfreezing – Changing – Refreezing. We also saw William Bridges’ three-phase ‘Transitions’ model: Letting go – Neutral zone – New beginnings.

These are all powerful as predictive models of change and, like all models, none is true. Yet each offers up valuable insights which can help you predict, understand and mange change.

Further Reading

  1. The Managing Change Pocketbook
  2. The Handling Resistance Pocketbook
  3. Survive and Thrive in Times of Change,
    Training and Development Journal, April 1988,
    Dr Cynthia D Scott and Dr Dennis T Jaffe
    This article is not available freely on the web.
  4. On Death and Dying,
    Dr Elisabeth Kübler-Ross, 1969
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Resistance to Negotiation

Over the last couple of weeks, we have looked at:

One of the things that most worries inexperienced negotiators is the question: ‘what if they say no?’ or even ‘what if they don’t like my offer?’

If these bother you, don’t worry.  Of course they will say no – several times: it’s their job.  And of course they won’t like your offer – unless it advantages them, rather than you; which would make it a foolish offer for you to make.  instead, start to see resistance as a part of the process.

Understanding Resistance

The Handling Resistance Pocketbook is a toolkit for anyone encountering resistance, and at its heart is a model to help you understand resistance, assess what is going on, and choose from the tools available.

The Onion Model

The Onion Model is a tool to uncover the layers of resistance.

Onion Model of Negotiating Resistance

With this model, you can see why resistance is so inevitable.  The first two layers are about meaning: they may not understand your proposal – so find a new way to explain it, or they may doubt why you made it, so be clear about the basis for your proposal.

Next comes doubt about your ability to stand by your proposal: ‘it’s too good to be true’ responses fit in here.  Provide evidence of your bona fides. Next comes the powerful rejection – probably because your proposal is not good enough.

But if it is good enough, credible and fully understood, they may resist for historic reasons: they may not like you but, more likely, they have some other reason to not want to do a deal with you.  Maybe your organisation misled them in the past, maybe another organisation did and, in their mind, ‘you’re all the same.’

This last layer is rarely about reality – more often it is about perception.  So you need to understand the basis of that perception and undermine it with counter evidence… always in a respectful way.  Try using an adaptation of the ABCDE process, a tool form the heart of Cognitive Behavioural Therapy (CBT).

Other Pocketblogs about Handling Resistance

The Handling Resistance Pocketbook, by Mike Clayton

 

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The Onion Model of Resistance

The Handling Resistance Pocketbook, by Mike ClaytonThe Onion Model of Resistance is at the heart of the Handling Resistance Pocketbook.  It is a model I developed initially to describe resistance to change.
I subsequently generalised it to cover handling:

  • resistance to ideas in a presentation
  • sales objections
  • resistance in a learning environment
  • resistance to engagement

 

Creating the Onion Model - Training Journal article by Mike Clayton

I recently had a couple of articles published by Training Journal, which I have put onto my Handling Resistance blog:

  1. Creating the Onion Model
  2. Resistance to Engagement

I hope you will enjoy them.

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I can’t do that now

The NLP wave rises and falls and, frankly, I’ve lost track of whether it is near a popularity peak or a sceptical slump.  Of all the ideas that managers use, this is the one that comes in and out of vogue most often – on a two or three year cycle, it seems to me.

Why does NLP peak and trough so much?

Many practitioners do NLP no great service in making some extravagant claims for what it can achieve, whilst others doggedly push away at the very real benefits of improved communication, processes and insights that an understanding of its models can offer us.  The world becomes exhausted by and cynical of the excessive zeal of some trainers, then recovers, as other trainers help build a new cohort of learners who can see real benefits.

Gillian Burn’s NLP Pocketbook is a contribution to ‘real benefits’ end of the spectrum, and has a nice take on one of the most powerful NLP models.

Logical Levels of Change

This model has many uses, so let’s pick one: let’s say that you ask someone to do something.  Let’s further assume that your request is reasonable, and that your relationship with them is good, so you have every reason to expect them to comply.  So it comes as a surprise when they say:

‘I can’t do that now.’

Handling Resistance

This sounds like resistance, so rule number one is to respect the resister and assume that their reason for resisting is a good one.  But what is it.  On the face of things, their statement gives you no clues; but if you listened very carefully, they probably told you exactly where the problem is.

Listen Carefully

What you are listening for is where they put the emphasis of their statement.  It may be very subtle, but can be remarkably obvious.  They may have said any of these statements:

‘I can’t do that now.’
Meaning: ‘there is a problem with the time or place.’

‘I can’t do that now.’
Meaning: ‘I have a problem with what you want me to do’

‘I can’t do that now.’
Meaning: ‘I don’t have the ability to do it’

‘I can’t do that now.’
Meaning: ‘I don’t believe I can do it’

I can’t do that now.’
Meaning: ‘this is not something I can do’

Once you know where the problem lies, you can tackle it more confidently.

What else?

Could there be another reason?  What if there appears to be no emphasis.  The Logical Levels model suggests a sixth possible level, deeper than the five we have seen.  If we characterise these five as:

Environment – Action – Capability – Belief – Identity

… the sixth level is Purpose, or meaning.

People need a Purpose

We all need a meaning to our lives and a purpose for doing something.  In their mind, they are possibly asking ‘why?’ If you are unable to supply a good reason, then you should not be surprised to encounter resistance.  One of the powerful words we looked at in an earlier blog is because.’

Management Pocketbooks you might enjoy

The NLP Pocketbook

The NLP Pocketbook
is full of easy to follow descriptions and examples from the best tools that NLP has to offer.

NLP, by the way, stands for Neuro Linguistic Programming

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There is also a chapter on the NLP model of communication in:

You might also like:

So here’s the deal

Listen carefully when people resist you, act on the information you gather: not your assumptions, consider the powerful tools NLP can offer you.

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If it sounds too good to be true …

The old saying goes: ‘if it sounds too good to be true, it probably is’.  But there is another possibility: ‘if it sounds to good to be true, then you haven’t done your homework’.

Catching out the best negotiators

Sometimes in negotiations, you will be caught off guard by an unanticipated comment, statement or offer.  There is very little that is more disconcerting than an offer that is better than you were expecting.  This is because even the best negotiators rarely prepare for this scenario.

The cautious response is to ask yourself: ‘where’s the catch?’ and proceed delicately.  But there may be no catch; the offer may be genuine.  So whatever you do, don’t risk giving offence by challenging the offer.  Unfortunately, when we get caught out, we often respond in an unguarded manner.

What else could be going on?

If there is no catch, then there are two further possibilities:

  1. the offer is a fair one
  2. they know something you don’t and the value is higher than you thought

What should you do?

Obviously, the lesson from this example is to prepare for even this scenario.  As Patrick Forsyth says in The Negotiator’s Pocketbook, ‘successful negotiators do their homework’.

But if you are unprepared, then you certainly don’t want to just jump on the offer.  So, do what you would do with any offer: make a counter offer, by asking for a little more.  What you do not want to do is quickly accept the offer and leave the other person wondering if they have over bid.  If they do that, it can lead to buyer’s remorse – a sense of disappointment with the deal that they have struck, which can lead to them later reneging on the deal or not doing further business with you.  Worse still, you don’t want to accept a great offer that you could have improved still further.

If you sense the offer is a fair one – just a little better than you had anticipated, then your counter offer can be a little higher.  If, on the other hand, you think they know something more about the value than you do, either go considerably higher or, if you can, take a time out to do some more research.

So here’s the deal

There is no substitute for being prepared before you go into a negotiation: both in command of the facts, and mentally prepared to deal with the unexpected.

What are your tips for negotiating, from your own experiences.  Let us and our readers know, by contributing your own comment.

The Negotiator’s Pocketbook

In The Negotiator’s Pocketbook, Patrick Forsyth sets out a seven step process for your negotiation preparation.  This Pocketbook really is full of fabulous insights and tips.

The Handling Resistance Pocketbook

Okay, so we’ve not been talking about resistance but in the forthcoming Handling Resistance Pocketbook (due in the autumn), you’ll learn a great process, called ‘SCOPE the resistance’ to deal with the kind of surprise this blog talks about.

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Read the Handling Resistance Blog at www.handlingresistance.com

Other Management Pocketbooks you might Enjoy

The Influencing Pocketbook

The NLP Pocketbook

The Salesperson’s Pocketbook

The Positive Mental Attitude Pocketbook

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Is This Relationship Going To Work?

Sometimes we find ourselves in situations that we wouldn’t necessarily have chosen, working with people who aren’t our natural soul-mates. Whether the relationship is Prime Minister and Deputy Prime Minister, or two colleagues sharing an office, conflict is probably going to arise at some point in the relationship.

Messrs Clegg and Cameron are both assertive and persuasive individuals who are used to winning the argument. But if they are going to work successfully together they will need to use a range of styles to manage potential conflict between themselves and their party members.

Five Approaches to Managing Conflict

Kenneth Thomas and Ralph Kilmann describe five approaches we can take to handling any particular conflict:

Compete – we aim to win.

Accommodate – our priority is to keep the other person happy.

Compromise – we do a deal. It’s not perfect but we can both live with it. At least in the short term.

Avoid – we take the view that it’s better not to open the can of worms, so we don’t address the issue.

Collaborate – we look for a solution that fully meets our needs, and also satisfies other person. A true ‘win/win’.

Which One To Use?

Looking at these five styles, you would think that the ‘right’ approach to conflict would always be to collaborate. However, there are a couple of problems with collaboration:

  1. It can take a long time – you have to sit down, explore the other person’s position, analyse the underlying needs and concerns then try to thrash out a resolution. It’s great when you have the time (and the energy) to do this. But sometimes there’s a deadline. Sometimes the markets are showing signs of impatience.
  2. It isn’t always possible. For example, when you and your colleague have fundamentally opposing views or values.

The trick is actually knowing which type of approach is most appropriate in any situation, and consciously adapting your natural preference for one of the five styles.

T-KStyles

So here’s the deal

One of the secrets of handling conflict successfully, whether it’s in a shared office or the House of Commons, is choosing the right strategy.

Management Pocketbooks you may enjoy

TacklingDiffConvsFor more on handling conflict, and coping with difficult conversations generally, take a look at Peter English’s new Pocketbook, The Tackling Difficult Conversations Pocketbook.

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Other Pocketbooks you might like include:

You may also be interested to know …

The Thomas-Kilmann model is also available as a self-scoring psychometric instrument. For global sales, check out the CPP website, or for UK sales, check out OPP’s website.

Author: Peter English

This article was written by Peter English, author of:

The Tackling Difficult Conversations Pocketbook and

The Succeeding at Interviews Pocketbook.

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