After the Tesco session and with the 1996 publication of their book Lean Thinking: Banish Waste and Create Wealth in Your Corporation (Simon & Schuster), Dr. Womack and Mr. Jones began to study the ways in which muda travels from one company to another — in which companies themselves are caught up in waste-filled interrelationships that no single enterprise can tackle alone. This year, that work is coming to fruition in their third commercially published book, called Lean Solutions: How Producers and Customers Achieve Mutual Value and Create Wealth (forthcoming in September from Simon & Schuster). The new book argues that even the most brilliantly conceived and efficiently executed products and services on the market can be rife with muda. For example, as an offshoot of their products’ increasing integration — music stored on personal computers is played through audio equipment; toys and accessories are sold as ensembles; cars become a series of interconnected electronic systems — the makers of automobiles, computers, electronic goods, tools, toys, and housewares have, in effect, downloaded their process problems onto their customers. Instead of increasing value, they have added complexity. As a result, more often than not, say Dr. Womack and Mr. Jones, attempts at integration fail to achieve their goal of providing customers a better product.
Services are frequently just as flawed, the authors claim: When you phone a help desk, bring an auto in repeatedly for a seemingly unfixable repair, or spend an hour waiting in a hospital room for a routine medical test, you are dealing with a costly artifact of an outmoded industrial model. Whether in services or products, this model adds costs, decreases quality, promotes remote and therefore dangerously unresponsive off-shore outsourcing, and imperils brand loyalty.
To Dr. Womack and Mr. Jones, the essence of lean thinking is not so much the ruthless efficiency of reengineering (with which it is often compared), but the ruthless redesign of all processes, within and among companies, to achieve an ingrained respect for the people affected by these processes. If the whole world could emulate the best of Toyota, Tesco, and a few dozen other relatively lean companies, we could enter a new kind of post-industrial utopia, they argue.
“We started out thinking about how to optimize production processes,” says Dr. Womack. “To accomplish that, you have to reshape the company and the value chain to meet human needs, and it eventually turns out to be a pretty interesting human sort of endeavor where, by God, you want to optimize everything.”
To implement lean thinking is not easy, nor is it a guarantee of instant financial success. Consequently, as with many management fads, says Dr. Womack, companies tend to drift away when they notice how hard it is to put in place.
“Every company will tell you they’ve got a lean initiative,” he says. “But a true lean initiative integrates four different systems: production, product development, supply chain management, and customer management. Most companies have only begun to work on one of the four.”
Nonetheless, a growing number of businesses have made a sustained commitment to lean thinking that often does pay off over time. General Motors, for instance, adopted lean thinking as the guiding principle behind its “Global Manufacturing System,” which is the blueprint for all new plant designs and old plant retrofits — an ambitious undertaking to dig out from the company’s quality and cost problems. The company also hired John Shook, a senior advisor at Dr. Womack’s Lean Enterprise Institute, to map and redesign the company’s back-office processes. Enough muda was unearthed in this effort to save the automaker hundreds of millions of dollars a year.