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Change of Needs


“Business needs” change according to the change in the market.

I get excited about such change since it is an opportunity to learn something new.

Yet, not everybody sees such change as positive.

A typical approach is to deny everything from the past. Discontinuing any activity from the past is more important regardless of the legitimacy of proposed actions.

Kaizen is about gaining new capabilities. By eliminating waste, we create the capacity to include something new. The word's meaning has changed constantly, and we must accept that it is constantly evolving.

  1. Learn from crisis

  2. Don’t think as “Luck”

  3. Prove by operating

  4. Problem solved

  5. Kaizen first before using money

I hope we get excited about the new business needs by doing these.

“Our business need has changed.”

A new manager opened with such a statement. Then he started to deny everything that we did. The new focus was on quality, and he proposed adding more inspections. With his power, inspections were introduced.

I returned to the factory a year later. The factory was in crisis. Quality worsened. Cost increased. The manager left. We went back to the standardized work with more attention to quality. How to build-in quality to our standardized work was our new theme. Quality improved, and costs went down. We all learned something.

I got a chance to read this interview in which Taiichi Ohno answered questions from two Japanese professors in 1984. The exciting part of this interview was that Ohno described how the Toyota production system (TPS) had evolved chronologically.

It starts from those days when Ohno was working inside Toyota Boshoku. Ohno talks about how quality and standardized work was already part of the system.

Then he was transferred to Toyota Motor (1943). First, he only focused on productivity improvement to increase the volume. To accomplish this, Ohno’s first focus was on standardized work. Then, “Limited volume” was introduced. Improving productivity without an increase in volume is a signature concept of TPS. It was not part of the system from day one. Kanban was introduced much later (1955?). Jidou-ka, stopping the line in the ’60s.

There are so many lessons that I learned from this interview.

1. Learn from crisis

First is how they learned from each and every “Crisis.” Every time there’s a crisis, Ohno learns something, and the core lesson is added to the system. Productivity improvement remained the system's centerpiece, which they learned from the layoff in 1950. This DNA remained, and as a result, the CEO stated on 6/11/20 during the COVID-19 pandemic that “Toyota will remain profitable,” and now is the time to prove what they have improved since the Leman crisis. They learn from each crisis and change the contents of “Kaizen” so they can be prepared for the future. Today, some Kaizen targets reducing efforts to prepare for the aging populations. Another important topic is to support environmental issues. Eliminating excess packaging or implementing Karakuri, a gravity device, to provide power are some new concepts added to Kaizen. Yet, “old” productivity, safety, and quality topics are fulfilled. They never say, “Let’s sacrifice quality and productivity to accomplish environmental issues.” New challenges are included without canceling the old.

2. Don’t think as “Luck”

The second is, “Is this a great sequence of TPS implementation?” Or was Ohno “Lucky”? Ohno started with standardized work. Productivity improvement with volume increase was its original focus. These topics fit well with traditional thinking, and the market allowed him to do such actions. Under limited volume, the freed resource from productivity improvement is exposed to a conflict of firing by traditional thinking. We might be able to say that Ohno was “lucky” in some sense. But calling it “luck” won't give us many lessons. Instead, if the business needs situation differs from what Toyota & Ohno went through, we need to approach it more cautiously.

3. Prove by operating

The third is that Ohno was always at the frontline of these integrations of business needs, and the system grew with his responsibilities. For example, when Ohno was the machine shop manager, he saw the need for the assembly line (the customer) to level their production. Toyota’s reaction was to assign Ohno as assembly line manager to implement. This sounds very simple, but how often do we see the original owner of an idea as responsible for operating and implementing the concept? How often do we see a crash between new ideas and operations? “Proving by operating” is the best implementation model, not pushing, discussing, or negotiating. Instead of keeping the staff & line separate, sometimes rotating their positions facilitate implementations.

4. Problem solved

The fourth is about subtraction or elimination of problems. As they work on the current needs, they eliminate many existing problems not by adding resources but by solving them. Ohno talks about how orders were not levelized. Working with many suppliers, I know Toyota’s orders are the most stable. Because the order is exceptionally stable, many suppliers can operate with an effortless and low-cost order handling structure. And the freed resources focus on the new business needs. Don’t think about adding new needs without subtraction or elimination since the addition will overload. I hear many use the word “Challenge,” and Toyota people use this word frequently. But a challenge with subtraction/elimination differs from a challenge with just adding.

5. Kaizen first before using money

Finally but not least, Kaizen is to accomplish business needs without money. So even when there is a change in the needs, the cost of change is small. Too many organizations justify the use of money according to business needs. Yet, nobody can predict the future. When the future changes from the plan, we get into trouble. Instead, always seek non-investment solutions (Kaizen) first so that even with some change, we can compete. Even if investment became necessary, Kaizen should have reduced those.

Again, change should be positive. It is an opportunity to learn more. Something must have changed the perception if the business change is not taken as positive.

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