Picture: Jeffrey K. Liker who is presenting a workshop on The Essence of the Toyota Way in Auckland in November. For details visit www.pslglobal.net

The large majority of organisations that have embarked on an operational excellence program through lean, six sigma, or lean six-sigma, have found the results at first positive, then reaching a plateau, and then going in reverse.

The Shingo Prize committee out of America found that was true of too many of the past award winners. They concluded the difference between those who sustained the journey to excellence and those who did not was leadership and culture. This prompted revising the award to focus more intensely on leadership and culture, rather than just the tools.

The Toyota Way to Continuous Improvement (by Jeffrey Liker and James Franz) complements those efforts by providing a thorough treatment of the philosophy, thinking, and methods of a true culture of continuous improvement, and provides case examples of the journey.

The Toyota Way was never a process improvement methodology in which we implement change and work to sustain the gains, but rather focuses on a long-term quest for excellence based on creating a system of processes that reveal problems so highly developed people with finally honed problem solving skills can continually improve whatever they are responsible for.

This culture of continuous improvement provides an army of process improvement experts in every part of the company who are then aligned through a shared company vision. Separating out ‘lean processes’ as a standalone endeavor does not make sense for any organisation, and, in fact, treating lean and six sigma like a technical toolkit to fix processes is why most companies fail to achieve true operational excellence.

‘Sustaining the gains’ implies that like a machine, once the process is fixed there is a way to keep it fixed.

The only sustainment mechanism we know of is leadership. Unfortunately in the West we have evolved a model of leaders as decision makers who can remain distant from the actual core of the company that makes things or provides services.

Employees throughout the company model senior leadership. If senior leadership manages only by the numbers and emphasises results only, no matter how they are achieved, then employees will focus only on getting the results that are measured and improvements will not be sustained.

At Toyota they emphasise results through their annual planning system of hoshin kanri (aka policy deployment), but equally care about the process used to get those results. The process requires careful planning, finding the root cause of problems, then doing (trying countermeasures), checking to learn from the experiment, and making further adjustments based on what is learned. That leads naturally to the next PDCA cycle and through repeated cycles team members and leaders at all levels learn and strengthen their capabilities. Equally important in this PDCA process is how you engage team members so they can learn and develop. In Toyota they say that results without a good process results from luck, but a good process can always be adjusted to get consistent results. Of course leaders need to lead a good process, which means they need to be masters of problem solving.

Leaders who come to the worksite and are well trained in problem solving can guide and coach the work groups to solve problems at the root cause and then audit the process to find additional opportunities for improvement. If continuous improvement stops it is only natural that entropy kicks in and the process will degrade.

So sustaining the gains is an active process by work groups who own the process continually surfacing problems and solving them one by one. There is much to learn about creating a culture of true continuous improvement to become an exceptional organisation that can continually adapt to the many significant challenges that face any modern organisation.

For more information see: Jeffrey K. Liker and James K. Franz, The Toyota Way to Continuous Improvement: Linking Strategy and Operational Excellence to achieve Superior Performance, McGraw Hill, April, 2011.

Dr. Jeffrey K. Liker is Professor of Industrial and Operations Engineering at the University of Michigan and author of the international best-seller, The Toyota Way: 14 Management Principles from the WorldÕs Greatest Manufacturer, McGraw Hill, 2004 along with six other books about Toyota. His articles and books have won nine Shingo Prizes for Research Excellence.