EXCEPT FROM THE BOOK - In the introduction to his new book, Art Byrne looks back on his lean- journey and explains why you need to change your mindset to understand lean .

Words from: Art Byrne

My journey to lean began in January 1982. I had just become general manager of the High Intensity and Quartz Lamps Division, a part of General Electric's Lighting Business Group in Cleveland, Ohio. In the fall of 1981, my operations manager and the operations manager of another part of the Lighting Business Group, which supplied my company with arc lamps, went to Japan for a week to discover Toyota Motors' new "just-in-time" concept.

This trip required them to follow up on something they had observed within six months and report on it to GE's central manufacturing staff. Since one company was a supplier to the other, they decided to use a simple kanban system. My fellow general manager and I both thought this was a good idea. At the time, the idea of just-in-time was new and we were all curious about it. I had even read some articles and an early book on the subject, but I must admit that I still didn't know much.

What we did was simple. We wanted to see if this just-in-time system could work. We bought a small truck and made kanban quantities and kanban maps to represent each tray of arc tubes. Our factories were about a 45-minute drive apart. Each morning the truck would deliver a new batch of tubes to my factory and take the kanban cards that stood for the trays of tubes we had used the day before. The next morning the truck would deliver the arc tubes based on the kanban cards it had picked up the day before and bring a new set of kanban cards. This was all very simple and worked smoothly.

The results were overwhelming. Within three months, my inventory went from 40 days to 3, and my supplier's inventory went from about 60 days (they had a huge room filled with nothing but my arc tubes) to zero. That was nice, but in those days GE was all about "making it through the month" and nobody cared about stock reduction, so we didn't get any pats on the back for this success. What we did get were surprising improvements in every other area.

For example, our customer service improved dramatically and our turnaround times decreased by large amounts. As we removed inventory, our shop floor became cleaner and safer. Our staff was happier in the new environment and productivity went up. Arc tubes are extremely fragile items, and by limiting the quantity, people had to handle them more carefully, which reduced our downtime and increased our quality. This was an epiphany for me. I discovered the huge advantages of just-in-time inventory over our previous "just in case" approach. Excess just-in-case inventory had done nothing but hide waste.

Based on this experience, I decided to learn more about this approach and use just-in-time in any business I would run in the future.

As it turned out, my subsequent roles as group manager at the Danaher Corporation, CEO of the Wiremold Company, operating partner at a private equity firm and in a few volunteer roles, helping a friend or serving on a board of directors, allowed me to implement lean in various industries.

During this work, I learned how lean can work in any industry if you understand how to implement it and are willing to stick with it. For me, the real learning took place shortly after I left GE and became a group manager at the Danaher Corporation.

One of the companies I was responsible for there, Jacobs Engine Brake (or "Jake Brake"), was having a very difficult time. President George Koenigsaecker and I were the only two people in Danaher with just-in-time experience, so we decided to solve it with that approach. By that time, 1986-87, we started calling this approach "TPS" or the Toyota Production System. The term "lean" wasn't really used until 1996 with the publication of the book Lean Thinking by Jim Womack and Dan Jones. Yet they are all the same.

We made good progress early on and set up a few production cells. They were not very good, but much better than before. Then, in early 1987, we got lucky. We had read Masaaki Imai's book Kaizen and discovered that he was holding a week-long just-in-time seminar in Hartford, Connecticut, near Jake Brake. George signed us up and took about five of his people and myself with him (my office was in the Jake Brake building).

The seminar was given by the Shingijutsu consultants - three former Toyota executives who had worked directly for Taiichi Ohno, the father of the Toyota Production System, who taught TPS to Toyota's first-tier suppliers. George and I thought, "wow, these are the guys who could really help us," and George harassed them all week. One night he treated them to dinner and then took them to the factory. They came again later in the week, when I could be there, and we had another meeting on Saturday morning before they left. We basically begged them to come and help us. They said, "We're too old, we don't speak English and it's too far away." We said, "But we have great steaks and lobster and lots of golf." I think golf won the argument.

We started this work at Jake Brake and a sister company, Jacobs Chuck (also one of my group companies). George K and Jake Brake took the lead. The Shingijutsu men said to us, "Everything here is wrong, what do you want to do about it?" They were not normal consultants. Not PowerPoint presentations. Actually no presentations at all. We just worked on the shop floor to find and eliminate waste. They gave us some training in the principles of the Toyota Production System, but most of the work consisted of showing us how to set up and implement a kaizen.

At Lean it's all about learning by doing, and at Shingijutsu we were constantly doing and learning. We worked with them on the floor all day and then took them out to dinner every night to give them more information. On weekends before a kaizen week, we took them golfing and, of course, pumped them for more information. We heard great stories about Taiichi Ohno and how he operated. He apparently scared everyone to death because he was very tough, but at the same time they revered him because he pushed them to be better.

We learned how to reduce setups, how to create flow and standard work, and most importantly, how to see the waste we didn't see before. The implications of all this learning were quite mind-boggling when you consider what it meant for the entire company. George K and I both had some strategic planning background, and soon we saw TPS/lean as the greatest strategic weapon we had ever seen. One day at lunch, we told Iwata, the president of Shingijutsu, this. "Iwata, TPS is the greatest strategic weapon we have ever seen. How can Toyota allow you to teach it to others?" He looked at us and smiled. "I can tell you about TPS," he said, "I can even take you and show you, but I bet you can't go home and do it."

Well, after all these years, Iwata's prediction has held up and proven to be true. But why? The lean fundamentals of work to takt time, one-piece flow, standard work, and pull system are all pretty easy to understand. What is difficult is that lean is more of a way of thinking, a philosophy you might say, about how to look at work, manage people and run a business. If you can't change the way people think and see things, you won't be successful.

That's easy to say, but hard to square with the fact that lean sees almost everything in the opposite way from how most people are trained. If your entire business experience, your success and your rewards come from doing something a certain way, how would you react if I came in and challenged you by saying, "Look, this is all not good?" Probably not too well. Let's take a couple of examples to illustrate the point.

For decades, the accepted wisdom in the auto industry was that whatever happened, you followed the "don't stop the line" rule. It was assumed without question that it was much cheaper to fix defects after the fact. After Shingijutsu went to help Porsche, I was asked to give a lecture there, and during a tour of the factory I was told that "Porsche never made a car without a defect for the first 60 years." But then Toyota came up with a "stop the line" approach that produced superior quality and much lower costs. Control was given to operators by means of a cord they could pull to stop the line if there was a problem. Porsche adapted so that problems were addressed and solved on the spot and, little by little, eliminated for good.

A similar example is the contrast between series production and one-piece flow production. The traditional view is that series production involves the lowest cost. In part, this is because "cost" is narrowly defined and overlooks a range of system costs. This loose term does not take into account excess space, excess inventory, additional moving and storage, longer lead times and certainly not the write-offs that occur when a batch is bad and must be discarded. When all of this is factored in, a piece flow results in lower costs in almost every case - even if the traditional manager may not accept it.

CHANGE THE MINDSET

Given the above, it is difficult to change the traditional "make the month" mentality that exists in most companies and convince managers and leaders to embrace the lean approach, eliminating waste in your own operations to deliver more value to your customers. Making the switch requires strong leadership with knowledge of the benefits lean can bring to all your stakeholders: the customer, the employee, the community and your shareholders. The first step is to provide leaders with the lean knowledge they need to guide the rest of the organization.

Books are a good place to start, and there are many books on lean that can provide an introduction; Lean Thinking by Womack/Jones, The Toyota Way by Jeff Liker, and Learning to See by John Shook and Mike Rother are all excellent. Visiting companies that have become lean is also a good way to do this. The next step is to hire a lean consultant who can help organize and run kaizen events in your company. I took 15-20 people a year for a week-long trip to Japan so they could see lean in action in many different companies. This is the way I learned it, and the same is true for most successful lean leaders.

The purpose of my new book is to offer some help with your lean journey. My previous two books, The Lean Turnaround and The Lean Turnaround Action Guide (which won a Shingo Prize), were both well received. I have also written 100 articles on lean for the Lean Enterprise Institute, LEI, under the heading "Ask Art." Hopefully, these articles have helped people better understand various aspects of lean . This book brings these articles together in a way that allows you to focus on the aspects of lean that are most relevant to your current situation. Simply go to the Ask Art article that addresses your current problem. Of course, if you read all the articles, you will have an excellent knowledge of what lean is and how to implement and manage it. I hope you take this approach.

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