8/14/2019 September 2228, 2009 Business in Vancouver

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Dominic

Schaefer

Companies learning to be lean the Toyota wayGlobal success o Japanese auto-manuacturing giant is a direct result o a corporateoperating philosophy that emphasizes employee accountability and continual improvement

Krisendra Bisetty

Toyota Motor Corp.s e-icient cars have earned

the Japanese auto giant topplace among global auto-makers, and now its busi-ness principles are helping

drive a new approach to run-ning companies and manu-acturing.

B.C. manuacturers,known largely or their loveo the status quo, are start-ing to adopt the oyota wayo doing things to generate

more eciencies, cost-sav-ings and productivity, saidDavid Chao, a Vancouverconsultant who has beenhelping businesses locallyand abroad hitch on to theconcept o lean manuac-turing.

And in a coup or Chao,

who is president o LeanSensei International, threegurus o the lean world arein town this week to talk at alean strategy summit he hasorganized or B.C. manuac-

turers and other businesses.Jefrey Liker, Mike Hos-

eus and David Meier, con-

sidered authoritative gureson oyotas production pro-cesses and authors o sev-eral books on the subjectwill provide insight overthe three-day conerence onwhat lean means or businessleaders and companies.

Its really become aglobal movement, Likersaid in an interview. Itsbeing adopted by hospitals,mining companies and i-nancial companies and bygovernments.

Likers 2004 book, TheToyota Way: 14 Management

Principles from the Worlds

Greatest Manufacturer, be-came an international best-

seller. Its based on theunderlying philosophy andprinciples that drive oyotas

quality and eiciency-ob-sessed culture.

With oyota operatingnot as a single global giantbut as a collection o smallto medium-size companies plants, dealerships and en-gineering divisions each de-

veloping their own capabil-ity to continuously improve the companys philosophyis inding widespread ap-peal, he said.

One o the things thatdistinguishes oyota is avery long-term perspective,said Liker, who is proessor

o industrial and operationsengineering at the Univer-

sity o Michigan and prin-cipal oOptiprise Inc., aMichigan company thathelps companies learn romoyotas management prin-ciples.

Teyve also set an inter-

mediate vision and one othe major things theyre o-cused on is increased sel-re-liance o every region o thecompany.

he vision gets turnedinto goals or each operat-ing region and then broken

down into objectives or eachbusiness unit o oyota, in-cluding engineering, manu-acturing, sales and the sup-ply base.

Eventually it gets to thepoint where every hourly

worker, engineer and man-ager can outline what will be

accomplished and how it re-lates to the global vision.

But Liker said the abilityto align goals and objectivesrom the boardroom down

to the actory oor is directlyproportional to the strengtho a companys leadership.

I the management is nothighly skilled in continu-ous improvement, then justgiving them goals is prettyhopeless, he said.

Youre just giving thema goal that they have to ailat.

Or theyll ind ways tomake the numbers lookgood, but perhaps sacricequality or saety.

In North America ,oyota has worked or dec-

ades to develop a completeline o leadership rom thetop to the bottom o thebasic hourly work group toteach companies its systemor eliminating waste andsolving problems in produc-tion.

And because theyve

made that investment, whentheres something like thisrecession, theyre able to bevery adaptable, said Liker.

He added that manycompanies want a short-term turnaround, but theirpeople arent capable o it.

Tey dont have a stableprocess to begin with, andthey dont have the tools orimprovement, so they justkind o struggle and oun-der.

Chao, a ormer oyota

consultant and the rst en-gineer hired by Suzuki

Canada Inc., said that un-like at oyota where every-

one, including executives,is required to spend time onthe actory oor, most senior

managers o North Amer-ican companies havent eventouched their product.

And in North Amer-ica, we ofen say, I it aintbroken, dont x it, but theoyota way says, I it aintbroken, lets make it bet-

ter.Among the 75 local cli-

ents Chaos team has coachedover the past decade is Paris

Orthotics, Canadas largestmanuacturer o prescrip-

tion orthoses, or oot archsupports. In late 2006-07, itwas battling to scale produc-

tion capacity ast enough tomeet overwhelming increasein orders.

It sort o tipped us overthe tipping point, recalledPaul Paris, the Vancouver-based companys president.We used a lean interven-

tion as a catalyst or a mech-anism to help us get out o

the crisis.Te problem with most

Canadian manuacturers,said Chao, is that theyre tooocused on money-making

and cutting corners to savecosts instead o giving cus-tomers what they want.

We will sacriice long-term gains or short-term[benets], whereas in Japan

and particularly oyota,theyll sacrice short-termgains to ensure that theres

long-term viability.Chao said that when he

walks into a typical Can-adian actory, hes alwaystaken aback.

I walk in there and with-in 15 minutes I can point out20 things that can be im-

proved.sy@s.

ToyoTa

MoTor Corp.

(NYSE:TM)

Toyota City, Japan

President: Akio Toyoda

Employees: 324,222

Market cap: US$129.3 billion

P/E ratio: N/A

EPS: (US$4.85)

SourceS: Stockwatch, Globe

inveStor, Yahoo finance

Its really become a

global movement

Jeffrey Liker,

author,

The Toyota Way

Lean on me: Lean Sensei president David Chao (left) helped Paul Paris Paris Orthotics improve production to meet overwhelming

market demand

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Toyotasmanagementprinciplesinclude:a philosophy that Toyota

exists to benefit customers

and society;a focus on survival for

the long term;

fixing problems and find-

ing their root causes before

proceeding; Toyota has a

single eight-step problem-

solving method for the

entire company; and

developing people by

respecting and challenging

them; Toyotas view is that

a person who is not learn-

ing and is not challenged is

not growing and therefore

is not being respected.

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