I know I've already linked to this article and other blogs in the lean world have already commented on it, but I have a few other comments.
The publicity about Toyota becoming No. 1 will create another burst of energy to lean, even though a survey by management consulting firm Bain shows that just 19% of companies that have tried it are happy with the results, says Mark Gottfredson, Bain's head of performance improvement.
So the irony of this news is that lean is more likely to become the new “flavor of the month” at companies… therefore keeping that 19% rate constant (or dropping it) if more companies implement superficial lean (“fake lean” as Bob Emiliani calls it or “L.A.M.E.” as I call it). More companies will try 5S and say “we're doing lean,” then they'll be disappointed with the results, or they'll lay off employees, etc. They'll say “lean didn't work for us” and the predictable pattern follows.
Lean's move into the service sector has created big demand for statistical experts with a nose for waste. Those willing to jump from manufacturing companies to hospitals or banks are getting pay raises of 30% to 40%, compared with 20% raises moving from one manufacturing company to another, says Jake Stiles, president of an executive search firm that has concentrated exclusively for 15 years on finding lean-regime experts.
“There is a whole industry luring away Toyota and General Electric people,” Gottfredson says.
What do Six Sigma and GE have to do with Lean and Toyota? There's absolutely ZERO reason to bring up Six Sigma in an article about Toyota. I've heard Toyota people say they don't have a “Six Sigma” program. They might use some statistical methods, but it's not Six Sigma (Toyota definitely isn't firing 10% of their workforce each year). GE is just scratching the surface with Lean methods, or so I hear.
Purists differentiate between lean and Six Sigma. They say that lean seeks to eliminate waste, while Six Sigma focuses on quality and defects. But quality and waste often go hand in hand, and most experts today practice LSS, or lean and Six Sigma together.
I get frustrated when people think lean is only about reducing waste or improving flow. Quality is one of the key goals of a lean system (defects are a type of waste and reducing them certainly improves flow). Jidoka, or quality at the source, is one of the two pillars of TPS, along with Just-In-Time (flow). How do so many people misunderstand that? You don't NEED Six Sigma to work on quality, lean is all about quality as well, but without the statistical focus. Do you want a team of Black Belt experts analyzing your problems to death or do you want the people actually doing the work driving kaizen and error proofing? I'd prefer lean for all but the most unsolvable problems.
To succeed, LSS requires a major commitment, Mairani says. It often fails because, “Authors write a book. Senior managers read them and decide to do this stuff with minimal training.”
Gottfredson says that if four in five companies remain dissatisfied, LSS may fall from favor and go down as the latest fad. But something much the same will replace it. It will just have a new moniker, Gottfredson says.
Somehow, an article about Toyota and lean morphed into an article about “Lean Six Sigma.” The fad goes away and it will come back with a new name. Sigh, the cycle continues.
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