What makes some companies consistently outperform their peers while others appear to be little more than one-hit wonders? It’s because the positive paradoxes of lean management help build a sustainable long-term perspective and a passion for improving people – and organizations, says Dr. Jeffrey Liker, author of influential works on lean management such as “The Toyota Way: 14 Management Principles from the World’s Greatest Manufacturer”.
Liker is celebrated for cracking open for general audiences the essential management philosophy of Japanese car maker Toyota and its role in the company’s steady rise from a small manufacturer to become one of the world’s largest and most successful auto makers. Widely known as “the Toyota Way” the philosophy has formed the bedrock for lean management principles, which emphasize maximizing customer value while minimizing waste.
According to Liker, the path to the sustainable and long-term success driven by lean management methods begins with a vision.
“The first step is to understand what lean is and to develop a vision of what you’d like your company to look like in the future. Many companies adopt lean management without knowing what it is,” he observed in an exclusive interview with Nordic Business Report.
Forget one-off projects; aim for a sustainable culture
What lean is not, Liker said, is another efficiency tool in the consultants’ armory that can be applied as a band-aid or used as a tactic for short-term wins. Paradoxically, it may be possible to reap the rewards of lean management in a compressed time frame of five or 10 years rather than 50 – but there are no real shortcuts either, Liker said.
“If you just play at lean, do an event here and there and hire consultants and do a project here and a project there, you don’t develop the culture that is really the essence of lean. So you have to make a serious commitment to building a sustainable culture,” he added.
Other essential pillars of a lean management culture include respect for people and continuous improvement. Liker explained that the philosophy defies some schools of thought that emphasize the development of technology and processes first, and people last.
“Respect for people is very deep and it also extends to developing people by challenging them to improve, which gives you continuous improvement … And as you develop people you become a more adaptable organization that can adapt to change,” Liker explained.
Managers as mentors
The lean management guru acknowledged that from a western perspective, lean management’s people focus appears to be inconsistent with the hierarchical structures common in Japanese companies.
But Toyota’s view is that managers are mentors who are intimately involved in developing their teams, rather than corporate “big brothers”.
“So the question for Toyota is not how many people can you monitor if you trust them, but how many people can you deeply teach?”
“Toyota believes that a good leader can actually only train about 5 – 8 people to give them enough time to teach. So with groups of five people it stacks up to be more layers,” Liker added.
Slow down –and speed up!
Another fundamental paradox Liker discovered is the idea of “slowing things down to go faster”. Concrete examples involve delaying product management for faster results and just-in-time inventory management, which entails maintaining smaller inventories for better parts availability.
“Underlying both of those is the idea that if you frontload the process, if you spend time and energy getting things right, then you’ll benefit in the longer term in the process or project.”
Ultimately, lean is far more than a special corporate tactic or one-off efficiency program. It is a culture, a way of thinking and acting that can be applied in any business or process. Once embedded in an organization’s DNA, it ultimately results in the paradoxical but virtuous circle of using fewer resources to create better value for customers.