Production as the mirror of the organization

In 2019, we spent a day together at the gemba at Volvo Torslanda. We were laying the groundwork for an article about the Volvo Cars leadership training program, developed by Gert. During the visit, Gert said something that has intrigued and fascinated me ever since (for dramatic effect, we recommend you read it with a Scandinavian accent, like the Muppets' Swedish Chef): “You know, Eivind, if you study an operation hard enough, you can actually see the whole organization.” That sentence contains an entirely new perspective on understanding and learning at the gemba.

Gert first heard about this concept during a visit to NUMMI in the early 1990s, while he was working at Saab. The Toyota senseis and managers seemed to look at the gemba as a mirror for the rest of the organization. By studying the work of the senseis, we learn that the gemba is a place to understand where our thinking is working and where it falls short in relation to production, product development or logistics. In fact, it is also a reflection of R&D, HR, marketing and purchasing practices. The devil is in the details, and learning to see those details is an important skill.

Business results are not random

As Deming taught us, we get what we deserve. Although we may often be lucky, the results of a business are never random. The better prepared we are, the more predictable our results will be. The value (and the waste) in a production chain always materializes in manufacturing. That is also the place where it is easiest to see. That is why we go to the gemba and practice genchi genbutsu: if every department and function of a company understands the nuances, struggles and requirements of the manufacturing process, the company will have a much greater chance of being prepared and of understanding its performance. Support departments, such as HR, purchasing and planning, influence the conditions that develop in manufacturing, and it is vital that they become more aware of this.

 

 

The pulse of the value chain

If we look at the manufacturing process as a continuous flow of value-adding activities moving at the speed set by customer needs (takt time), we can easily visualize how we go from raw material to finished product and challenge ourselves to study the consequences of a new product, new people, new machines, new materials or new suppliers being introduced. Ideally, we would like to produce value without causing delays or interruptions in the flow: the customer sets the takt time of demand, and through its smooth operations, manufacturing becomes the pacemaker of the company. But, unfortunately, reality is never ideal. That is why we need to look for what is normal (the continuous flow of value) and what is abnormal (interruptions in the flow of value) and identify the underlying reasons for the abnormality.

Let's look at how three functions not related to manufacturing – product development, HR and logistics – can influence, support or hinder flow, and how we can visualize this.

 

 

• Product development

In the lean world, we are used to categorizing every example of waste we see into Taiichi Ohno's “7 wastes,” often forgetting another major source of waste: flawed concepts in product development. By nature, product development is full of risks and uncertainties that we try to mitigate through things like market research (what does the customer really value?) or prototyping (will this new feature work?). In fact, many of the LPPD tools available to engineering departments can be seen as countermeasures to this risk.

Despite our best efforts, however, every product has design problems that are not discovered until the product reaches the production stage – when the tool touches the product, and value creation begins.

So, when we are at the gemba studying an operation, what should we look for in terms of design problems, communication failures or flawed concepts?

If we observe an operation or service delivery long enough, we will begin to notice which components operators are struggling to assemble (they may have to use excessive force or need to try several times to make the part fit before they succeed). In services, we can observe steps that are difficult for the user or for the service provider, or steps where the process is interrupted or delayed. In everything we do, we are guided by the lean idea of creating the most continuous flow possible with the least effort, to achieve what the work cycle sets out to achieve. Poorly fitting parts or unpleasant moments in the service are clues to possible problems, alerting us that perhaps the engineer or the service designer did not think about how to assemble a particular part or how to deliver a particular part of a service. They may also be a symptom of parts with very tight tolerances, combining to create problems for the worker, which ultimately can lead to quality problems for the end user. These kinds of problems usually show up as subtle issues at the gemba or in customer complaints, but they are always worth investigating from a design and engineering perspective. The answer is never clear, but at least we have a window of discovery.

• HR

“It's all about people.” “We build people before we build products.” “Good thinking means good products.” The passion for making things that characterizes a good lean company is only possible when combined with a passion for developing people. For Toyota, this makes perfect sense, but our Western obsession with separating functions has unintentionally removed HR from the process of “developing people.” Bringing HR to the gemba to study the effect of its work can be rewarding or painful (often the latter, unfortunately), but it is critical either way. But what are the signs that our HR policies may be falling short?

If HR's task is to find and develop people who will excel in the job they were hired for, then clearly they first need to be able to understand the preconditions of the job: what is required of the person and what skills and characteristics do we need to ensure so that the work is done in the best way? If someone is being hired to work in automobile assembly, where takt time is in minutes or even seconds, the potential worker must have the right skills and mindset and be able to perform a task in 60 seconds, 60 times an hour. HR must understand what zero defects means in combination with respect for people and how to find the right people for such a demanding job. At the same time, they need to keep in mind that, ideally, some of these team members will have the will and the capability to one day become leaders.

When you look at your gemba, how is HR supporting the value creators – whether they are line operators or service providers? Are they absent or present? Do they fully understand the demands of the work?

• Logistics

Usually, the first thing managers look for at the gemba is waste. But how about understanding where it comes from, such as the muri and mura coming from logistics and marketing?

Recently, one of us visited a company that had set up its internal flow to run continuously, but still ordered from suppliers in batches. This created a mess of broken, late, wrong and only occasionally right parts. In lean, we study the details of operations and think backwards: where are the points at which we are not providing our value-adding workers with the right tools, the right parts and the right skills, without muri? To achieve our ideal scenario here, we need to understand how logistics serves the continuous flow of value, from raw materials to finished products.

The view of the organization

When a Toyota veteran started working at Scania in the early 2000s, he spent a few days at the gemba just observing. When Gert asked him why, he replied: “Because now I know how Mr. Østlyng (Scania's CEO at the time) runs his company.”

This could easily be dismissed as a simple anecdote. However, the paradox we face is that the monotony of the gemba, the details of operations, service delivery and customer use give us a great view of an organization. The details act as a mirror of the whole. It takes practice, and the answers may not be easy to find, but if you are wondering how the HR, logistics, marketing or product development functions are impacting your company as a whole, the gemba is always the right place to start. So show respect, observe carefully and up close, and ask why. You may be surprised by what you find!

To paraphrase Dave Meier's sensei, Mr. Honda, “stand here and look. What do you see? Well, look more” (free translation of the original: “Sensei Secrets: Mentoring at Toyota Georgetown”).