Podcast interview with Ken Pilone, author of Lean Leadership on a Napkin, discussing Toyota, TPS vs. Lean, leadership humility, and common misconceptions about Lean management.
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My guest for Episode #455 of the Lean Blog Interviews Podcast is Ken Pilone. He is the author of Lean Leadership on a Napkin: An Executive's Guide to Lean Transformation in Three Proven Steps.
Ken has more than 30 years of experience in Organization Development in Government, Retail, Automotive, Distribution, and Aerospace. He is currently the Senior Manager of Business Process Engineering at Providence Health & Services — a role that encompasses internal Lean consulting, including executive coaching, lean training, leadership development, and all functions typical of a lean promotion or PI/CI function.
He spent nearly 20 years with Toyota as Lean consultant within company as well as with suppliers, vendors, partners and community groups. He a co-creator of the University of Toyota at the company HQ. He led the work to adapt the Toyota Production System to non-production environments (warehousing, supply chain, HQ administration depts., sales, product distribution, dealer operations, etc. In addition, he led the Center for Lean Thinking.
Ken has a Masters in Industrial Psychology and Organizational Development with his Toyota experience, Ken has developed specialties in Lean consulting in non-production environments, curriculum development and delivery, leadership and management development coaching, Toyota problem solving method training and public speaking.
Today, we discuss topics and questions including:
- Ken's Lean and Toyota Production System (TPS) origin story
- How he ended up working at Toyota
- How Toyota trained and developed people–and what he had to unlearn
- The purpose and role of the University of Toyota
- The challenge of translating TPS beyond manufacturing and beyond Japan
- Why Toyota used the term “Lean” internally–and whether there was debate about it
- The “Toyota salute” (the famous shrug: “It depends”)
- TPS vs. Lean: how Toyota thought about the distinction
- Why TPS is hard to define–and why it's always evolving
- How Toyota distinguished between practices and principles
- The most common failure mode in Lean transformations: copying tools without results
- The “Toyota Traditions” curriculum and what it was designed to teach
- What inspired Ken to write Lean Leadership on a Napkin
- His three-step model: introduction, integration, and internalization (vs. “implementation”)
- Common and harmful misconceptions about Lean and Lean leadership
- Why “5 Whys” isn't a rigid rule–and how it's often misunderstood
- Why calling oneself a “sensei” can be seen as inappropriate or offensive
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Podcast Transcript (Auto-Generated)
Introduction and Background
Announcer: Welcome to the Lean Blog Podcast. Visit our website www.leanblog.org. Now here's your host, Mark Graban.
Mark Graban: Hi, it's Mark Graban here. Welcome back to the podcast. It's episode 455, August 24th, 2022. Our guest today is Ken Pilone. You will learn more about him in a minute, but he is the author of a great little book–Lean Leadership on a Napkin: An Executive's Guide to Lean Transformation in Three Proven Steps. We'll be talking about that book. We'll be talking about his time at Toyota. We'll be talking about his time working in healthcare, or at least a little bit. We'll probably do another full episode about that down the road. So long discussion today, but there was so much to pick Ken's brain on–a lot of great thoughts, insights, stories, and opinions.
I think you will really enjoy this episode. For links and more information, look in the show notes or go to leanblog.org/455. Well, hi everybody. Welcome back to the podcast. Our guest today is Ken Pilone. He has more than 30 years of experience in organizational development in industries including government, retail, automotive, distribution, and aerospace. He's currently working in healthcare. He's the Senior Manager of Business Process Engineering at Providence Health and Services. He's joining us from California. Now, when we say automotive, Ken spent nearly 20 years with Toyota as a Lean consultant within the company, as well as working with suppliers, vendors, partners, and community groups.
He was a co-creator of the University of Toyota at the company headquarters when it was located there in California, and he led the work to adapt TPS to non-production environments. In addition, he led a group called The Center for Lean Thinking. So Ken has a master's in industrial psychology and organizational development, and I'm happy to say he's the author of a book I've been enjoying quite a bit. It's called Lean Leadership on a Napkin: An Executive's Guide to Lean Transformation in Three Proven Steps. So Ken, thank you for being here today. How are you?
Ken Pilone: Well, it's my pleasure. And I'm doing well. Thank you so much for including me.
Mark Graban: It's great to talk to you here. We'll come back and talk more about the book, but regarding the three proven steps, you touched on this in the book: it doesn't mean three easy steps, right?
Ken Pilone: That is absolutely right. I mean, it's simple to explain, but hard to execute.
Lean Origins and Quality Circles
Mark Graban: You explain well in the book, and we'll get to tap into some of that here today. There are so many stories and things we can touch on. I'm really excited about it. I think we can connect dots as your career has shifted. Ken, in particular, I'm interested in hearing about bringing these ideas from TPS and Lean into healthcare. But first off, if I do have standard work for the question I start with, most of the time I do like to ask guests about their Lean origin story. And my understanding is that yours actually started before, which is interesting.
Ken Pilone: Yeah, well, I had my embryonic beginnings in Lean with quality circles and aerospace. It was couched really as promoting efficiency within the aerospace business, which had a great need for that. However, it was not Lean as we know it today, but that's how I first sort of cut my teeth on the idea and the improvement–the notion of people getting together to improve things, cross-organizational collaboration, and sort of the embryonic beginnings of what would eventually shape up in my mind as Lean.
Mark Graban: For context, let's say some younger listeners might not really be familiar with quality circles as a term or an approach. It's something that's still used in Japanese companies. I rarely hear the term here in the States anymore. If you could just give a quick overview of that quality circle approach as you experienced it.
Ken Pilone: It occurs to me that I haven't heard the expression either in a really long time. Quality circles were one of several attempts that I remember in the early days to try to engage more people in improvement rather than just having top executives by means of stone tablets decree what would change. Instead, they started to get people closer to the actual work to get together and figure out how to improve quality. That was the focus back then; it was primarily and almost exclusively around managing defects. From that came other disciplines, Six Sigma and so on, but the quality circle movement at that time was very popular and widespread, but it seems to have given way to Lean and other methodologies since then.
Mark Graban: My exposure to quality circles was engaging team members, giving people some leeway to choose what they're motivated to work on. But I think one of the challenges is that the typical quality circle project might take six months to complete. Maybe the more recent creation, which is arguably not a Toyota practice–the Kaizen Event–is meant to be a more accelerated, more focused improvement burst instead of being something where a team gets together weekly or monthly.
Ken Pilone: That was my experience too. It's hard not only to maintain or achieve much momentum when you have these random meetings, but half of the opportunities when you did get together were spent cycling back and trying to remember what we did last time and what we decided we're going to do this time. New members would come and old members would leave. There's always the challenge of bringing people up to speed; it was awkward and stilted. But again, I think the biggest contribution that came from those days is the realization that people closest to the work actually had something worthwhile to say. They had something to listen to and they had something to contribute. That by itself was new.
Transitioning to Toyota Culture
Mark Graban: It seems like there's been maybe an effort to reduce the lead time and maybe reduce some of the batch sizes of the work, moving from a TQM project to a Kaizen event or blitz. But more the ideal is everybody improving something everywhere every day. I'd be curious to hear your thoughts on moving toward maybe an ideal of continuous flow Kaizen.
Ken Pilone: That's interesting. As I've explained my experience at Toyota to others, organizations less sophisticated in this area focus on a series of events. They'll have departmental Kaizen events and track them on boards. Compared to Toyota, where events were actually relatively rare. The closest there really would be to an event is at the end of a shift where the people in a given work group or team would sit around on a picnic table, reflect on the day, what went well, what didn't go well, and what experiments they might want to conduct tomorrow. Even at headquarters where it's all white-collar work, improvement was part of every dialogue, every meeting, every agenda. The improvement events were rare and not very conspicuous. It was just embedded in the daily routines there. If you're going to work there, you're going to be involved in improving all the time everywhere.
Mark Graban: Describing what Toyota is is different than having three proven steps or a methodology for helping others change.
Ken Pilone: I think that's where the evolution of this Lean thing is going–to get to some point where it's organic and part of the fabric of their institutions rather than just stuck on like an ornament on a tree. “Oh, we're going to do Lean now and look how shiny and beautiful it is,” but it's a standalone thing. It's not really the tree.
Mark Graban: How did you end up working at Toyota?
Ken Pilone: In many ways, it was quite a fortunate accident. I had been working at an aerospace company and we had four divisions there in Southern California. One was dissolved and they consolidated into three divisions. My division was unfortunately the one that was dissolved, and I was at staff level. My boss there happened to play tennis with the VP of HR at Toyota. On the tennis court, he mentioned to this gent that he was letting go of a guy in the training development area and was trying to help me land somewhere. What followed was a request to interview with the VP of HR at Toyota, which ironically was in the same town where I lived.
I had driven by Toyota many times over the years on my way to work thinking, “Someday I'm going to work there.” It's really odd how everything converged, but in the end, I got an interview and was selected to be the training and development manager at the company headquarters as my first role there.
Mark Graban: You had exposure to maybe related improvement methodologies, but as you were coming in to work on training and development and then the Toyota University, how did they bring you up to speed? What did you have to learn? Was there anything you had to unlearn?
Ken Pilone: There was a whole lot I had to unlearn. It was the weirdest company I'd ever joined. I couldn't make sense of Toyota for a long time. It wasn't as if there was a very deliberate onboarding to Toyota or the culture. I liken it to moving to a foreign country where you've essentially got no preparation and you're just immersed in it. Eventually, you learn the language, and from that, you learn the culture and appreciate the history.
It was a process of gradual immersion and assimilation. But there were also various points where my approach or work behavior was corrected, which taught me what was valued by the organization. For example, if I took a project and “made a decision” without having consulted with the stakeholders or the line people, I was coached by my boss by means of questions. “Who have you shared this with? Who have you discussed this with?” When I would say, “Well, nobody, I just thought it makes sense,” because coming from aerospace, that was the expectation–just do it. It was feedback and correction like that which helped me understand that this is a different kind of place. Yet at the same time, almost paradoxically, I was given more autonomy than I ever had at aerospace.
Mark Graban: There's maybe a mindset difference between knowing the answer and figuring out the answer, and figuring out would involve input from others.
Ken Pilone: I remember developing a curriculum that made perfect sense to me. As a new person, I wanted to showcase what I could do. I developed this beautiful management training curriculum that was the sum total of what I had learned and what the rightness of leadership was about. Only to get basically sent back to start over. It's like, “You don't even know who your customers are. You don't know what they want. You haven't consulted with them.” It was a very humbling experience.
The University of Toyota
Mark Graban: Can you recall specifically something you had to unlearn?
Ken Pilone: I think part of it is the whole notion of how problems are solved, how decisions are made, and how questions even get answered required me to be turned inside out because I no longer really understood what my role as a manager was. It didn't fit any definition I had been exposed to in industry before. Everything that I had been taught was the “rightness” of management. Coincidentally, I was teaching management at Cal State Long Beach at the time. I was teaching in the evenings as an adjunct professor. When I think back on it, I cringe at the stuff I was teaching and the books that I was providing to teach the rightness of leadership. I felt like I was hired because I knew all this stuff, yet when I arrived, I felt like it was irrelevant what I knew.
Mark Graban: What I hear you saying is thankfully they coached you through it as opposed to leaving you on your own. It seems like going through some of that experience yourself probably helps you relate to people that you've worked with along the decades who maybe now are having similar discomfort.
Ken Pilone: It does indeed. Most of the people that got hired into Toyota headquarters came from other American companies. For most people, it was a different experience. The people that were coaching me had themselves been through that same transition. We had a lot of laughs about it, but they were in a much better position to be sensitive to what I was dealing with and provide advice. Eventually, I got it by watching what other leaders were doing and mimicking–albeit awkwardly–what I thought they were doing, like learning a golf swing that feels uncomfortable at first until you finally groove it. Fake it till you make it.
Mark Graban: Tell us about the purpose of the University of Toyota and who the customers were.
Ken Pilone: About 10 years into my career at Toyota, I was tapped on the shoulder along with a half a dozen other people and asked to go figure out what a corporate university was and see if it made sense for Toyota. We moved into some temporary spaces, toured other universities, and concluded that it did make a lot of sense for us. The primary need at that time was that the training was so fragmented that it was hard to improve on it. There were bubbles of training everywhere. I was responsible for associate development, but I had peers involved in sales training, parts training, service training, and technician training. We were moving along in our respective silos. It was recognized that there were gains if we could collaborate and co-locate.
We bought a building close to the Toyota campus and outfitted it as the University of Toyota. Different floors housed different specialties, among which was the Global Knowledge Center.
Mark Graban: Was it focused on not just Toyota North America, but also Toyota's expansion to places like Brazil or Europe?
Ken Pilone: It started out as North America, but the company was going through explosive growth globally. Toyota Japan was really tapped out in terms of their capability to reach the far-flung enterprise. The training they did offer was almost exclusively around TPS manufacturing, and they quickly realized they didn't have the capacity or, from an English-speaking standpoint, the capability. Toyota USA, being the “oldest child” of the enterprise, took on the family business, so to speak. We were asked to take on the responsibility of providing education and training to the far reaches of the globe.
I was dispatched by the Global Knowledge Center on many occasions. I went to places like Singapore, Egypt, all over Asia, Europe, and North and South America. Regardless of where you went, as soon as you walk in a door of a Toyota facility–I remember walking into a Toyota dealership in Cairo–it felt like home.
Mark Graban: How so?
Ken Pilone: The artifacts were similar, the culture was similar, the methodologies and problem-solving routines were similar. Even though outside the door the culture was vastly different, when I went inside the facility, it felt like home. The other thing was how hungry and open they were to us coming to provide additional training, particularly when it got outside the manufacturing domain.
Translating TPS to Non-Production Environments
Mark Graban: What was the biggest challenge translating TPS to non-manufacturing environments?
Ken Pilone: It's hard to generalize. If it was a brand new plant or facility, that was a completely different deal than if you had gone to a more mature Toyota facility just to improve it. For example, Toyota Puerto Rico was actually very sophisticated and in tune with Toyota. On the other hand, some of the facilities were brand new offices, subsidiaries, or partners, like Canadian Pacific Railway. It required a whole lot of background training on: What is Toyota? Why do we ask what we ask? Why do we expect what we expect? The challenge was adapting to each condition–trying to figure out what this particular task requires. Is it history? Is it leadership training? Is it TPS?
Mark Graban: I wanted to ask about the Center for Lean Thinking. There are some who will say Toyota never uses the word “Lean.” I'm curious if you remember some of the thinking around calling it the “Center for Lean Thinking” as opposed to the “Center for Toyota Thinking.”
Ken Pilone: That's a great call out. When the University of Toyota was happening, there was this emergence of the word “Lean” in the business vocabulary. While it wasn't clearly articulated that we need to start calling it Lean, the zeitgeist around us seemed to be crystallizing around the notion of Lean, particularly non-production improvement mentality. Parallel with all that came Jeff Liker's book on The Toyota Way.
Most of the work we were responsible for at the university was in the white-collar space because our plants were big and complicated enough to justify their own training arms. However, the other side of the coin was being broadly neglected–the white-collar space. We saw this as a way to extrapolate what we could from TPS and call it Lean, partly because it was hip in those days and it was more descriptive in some ways. Even though Toyota didn't coin the term nor would it necessarily describe what they do as Lean, we felt like it seemed to be on the cutting edge of current business thinking which we wanted to align with.
Mark Graban: If people say “Is Lean the same as TPS?”, I think the answer is the classic “It depends.”
Ken Pilone: That's my standard answer for almost every question. Usually followed by the “Toyota salute,” which is a shrug. It's hard to pin Toyota down to define it because it keeps morphing and changing. What Toyota was when I was there is probably not as representative of Toyota today because it is constantly moving.
I will differentiate between TPS and what our challenge was. TPS arose from the production environment; that was the methodology to make cars and compete. What we were asked to do was to extract the more fundamental principles from Toyota as they manifest themselves in TPS. We had to go upstream and say, “We see problem solving on the manufacturing floor, but what's the philosophy in play here?” That's the germ we needed to capture–empowering people. I call Toyota's management system “Common Sense.” What do the operating principles and philosophies look like in a sales operation, dealership, or parts depot? To me, that was captured more in the broader sense of Lean than in the manufacturing context.
Mark Graban: We see those two types of settings within healthcare–work that is very repetitive and high volume versus work that is mass customization of a service.
Ken Pilone: Absolutely. In my work in healthcare, I've concluded that much of the work can be subdivided into work that is repetitive and predictable, and work that is abstract. It was helpful for me to be able to differentiate those areas because in the repetitive cases, I was able to apply TPS principles pretty directly.
Mark Graban: I think it's really important that you highlighted the difference between TPS practices and then principles and philosophy. Bringing out the higher-level principles and philosophy seems more directly transferable.
Ken Pilone: You said it better than I did. That requires us to zoom out quite a bit. Depending on the nature of the work and the sophistication of the organization, sometimes you have to zoom out pretty far and say, “Let's talk about what our principles are, what do we believe in here, what is our culture here?” as opposed to, “You need to put a poka-yoke device in this x-ray machine.”
Mark Graban: I think back to when I was starting at General Motors in 1995. Trying to copy practices and paste them into an environment that had altogether different principles and philosophies makes things worse. Like trying to install the practice of an Andon cord in an environment where the philosophy is “don't you dare stop the line.”
Ken Pilone: Absolutely. I think that's the biggest single failure mode when it comes to Lean adoptions. The practices and tools are readily available. You might ask, “If I've copied all the practices, why am I not getting the same result?” Because most organizations don't follow the process of plowing before you plant. They just spray the seeds out there and hope for the best.
I've been called into organizations asking what's missing, and I compared it to a puzzle. I said, “If you look in a puzzle box, you got all these pieces, but there's no picture on the cover.” You can look at every individual piece, but it doesn't inform an overall image of what you're trying to accomplish. It's unsustainable if the culture is toxic to those very same behaviors, like pulling the cord.
The Book: Lean Leadership on a Napkin
Mark Graban: I want to talk about the book, Lean Leadership on a Napkin. What was the spark of why you decided to write a book?
Ken Pilone: In my years at Toyota, I was impressed at how stories and pictures were embedded in everything–even in the A3s, using simplistic images to explain complicated ideas. I developed a knack for recreating the ones I had been exposed to on a napkin, or on the tailgate of a truck. I used that as my canvas to talk about basic fundamental ideas.
I went to a physician's office who I had been coaching, and he had a bunch of the napkins I had drawn on his wall. He said, “I use them to teach my people. You should staple those together and call it a book.” I started asking other people what they thought. My book was intended to be brief, short, and heavy on pictures. If I could have made it into a comic book, I would have.
I tried to draw on what I had learned with an overwhelming bias towards simplicity. The library shelves are full of books about Toyota and Lean. What seemed like a gap was for those executives that just wanted a basic primer: “Tell me what this thing is and feed it to me in a way that I can easily grasp it.”
The Three Proven Steps: Introduction, Integration, Internalization
Mark Graban: Can you give us the three proven step approach: Introduction, Integration, and Internalization? This seems very different than another “I” word that people use–Implementation.
Ken Pilone: It's been my experience that implementation is actually the easiest part. The heavy lifting occurs in that first phase of Introduction. It turns out that's where all the gravitational pull is because it's radically different from an organization's habits. This book was aimed at executives who are top decision makers. For a person who has been in leadership for a long period of time, it requires deep reflection: “Is this really something I want to do? Because it's going to require me personally as a leader to act differently.”
Once you get to that tipping point and you start to Integrate and embed some of the practices, if the pressure is maintained, you're on the downhill side of that bell curve where Internalization becomes relatively straightforward.
Mark Graban: Implementation often seems to be a one-step approach that shortchanges introduction. If people aren't fully participating and haven't internalized the principles, as soon as the consultant goes away, people go back to their old way of doing things.
Ken Pilone: That is ultimately what is hurting the Six Sigma movement. Experts come in, fix things, and leave. The people left behind are just left with “here's your new machine, run it,” as opposed to investing in the people themselves. The workforce isn't used to being asked to solve problems, experimenting, or taking risks.
Mark Graban: There are mutually reinforcing habits on both sides. If you're in a culture where you're never allowed to be wrong, it's safer for workers to say, “Okay boss, you do it.”
Ken Pilone: It is safer. In my book, I use an example where people come to work in traditional organizations and often check their “adultness” at the door. Outside of work, they solve problems, manage money, and deal with families. Yet they come to work and seem to shrink. They wait for permission and direction. Why wouldn't we want people to bring those grown-up skills to work? We live in comfort zones, and it takes courage to push on the edges of that.
Misinformation and Misunderstandings
Mark Graban: What's the most common or harmful misinformation out there about Lean?
Ken Pilone: What comes to mind first is the idea that leadership has to abdicate their role and responsibility. Empowerment does not equal abandonment. The other notion is that Lean is hard. It's not hard–at least not to understand. Healthcare talks about the need for simplicity, yet we do everything we can to make things more complicated. If people understood that this is common sense, they'd realize you don't need a PhD or a black belt to understand this stuff. It's almost as if people have an aversion to it being simple; if it's simple, it can't be any good.
Mark Graban: This next one falls into common misinformation: people take “5 Whys” very literally. In the book, you say it's not a rigid rule of the number five.
Ken Pilone: It's really more of a philosophy around digging deeper. When we think we've solved the problem, rarely have we. You keep “solving” the same problem over and over again–it's like painting over rust. Why not take the time to get to the root cause now? Some simple problems might only take three whys. It's also possible to dig too deep. If you keep asking why forever, you're going to be talking about the universe. We need to find that sweet spot in root cause analysis where there is something actionable that will solve this problem permanently.
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Mark Graban: One other thing–and I credit another former Toyota person, Pascal Dennis–is that at best you have a suspected root cause and you need to go test your understanding with countermeasures.
Ken Pilone: That's a great point. It is easy to describe this process, but it is not necessarily easy to accomplish it. Most people take a very superficial approach to this particular topic.
Mark Graban: One last one: the idea of the Sensei. You say that calling oneself a Sensei could even be offensive.
Ken Pilone: I didn't really know the meaning of the term myself when I was at Toyota other than in the context of karate. What I learned is that it's an honorific term ascribed to a person–usually a person that's very humble and would never consider themselves that. Introducing myself as “the world's greatest expert” comes across as arrogant. If someone else introduces me that way, it's different. But if you call yourself that, it's considered disingenuous. It makes me wince when I see “Certified Sensei” on a business card. It flies in the face of a core fundamental Lean principle: humility.
Mark Graban: I can't think of a time someone reached out and said, “Could you help me become more humble?”
Ken Pilone: Humility happens when you adopt certain principles and behaviors. By asking the workforce what they think about a problem, you learn new things. If you practice the Socratic method of open questioning from a place of curiosity rather than judgment, you start to realize how much you don't know. That prepares you to become a humble leader. Some organizations, like Toyota, would deliberately put top leadership out of their comfort zones by heading departments they know nothing about for exactly that reason–because it fosters humility. The leader has to listen because they don't know.
Conclusion
Mark Graban: Ken, thank you so much. Our guest today has been Ken Pilone. His book again is Lean Leadership on a Napkin: An Executive's Guide to Lean Transformation in Three Proven Steps. It's a really nice book. I've enjoyed the opportunity to continue our conversations and share it with others.
Ken Pilone: It's my pleasure. You and I were at an event together, and I told you about this idea. You said, “Start by writing.” So thank you for that.
Mark Graban: I'm glad you brought the book to completion. We can apply Plan-Do-Study-Adjust to writing. Thank you for sharing here today.
Ken Pilone: It's my pleasure. I enjoyed it thoroughly.
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