Today I got a disturbing, yet enlightening question from a client—one of our brightest trainees. He asked:
What is the relationship between problems and wastes? Doing Lean we are told to fight against the seven wastes, and then we start trying to find as many of them as we can… This makes sense. We are also told that Lean is about solving problems. We have to recognize our problems, find ways to make them visible and solve them using structured methods (5 Whys, PDCA, A3, 8D problem solving, …). This makes sense too. Which one is the right way: reducing/eliminating wastes or solving problems? Example: a warehouse one mile away from production. We always receive parts when needed, in the proper quantity. So no variation from the standard, but it is all waste.
This was disturbing because despite several years of our teaching him he has missed a fundamental point about the role of PDCA versus specific tools. It was enlightening because it reminded me how learning takes place over time, with repeated coaching, as the student learns and questions.
I feel very uncomfortable about saying “lean focuses on eliminating the seven wastes.” I also feel uncomfortable about saying “lean focuses on solving problems.” I would rather say “lean is a way of thinking about the business that depends on thinking clearly and deeply about the organization’s purpose and how best to organize to achieve the purpose.”
Plan-Do-Check-Act (PDCA) is the umbrella way of thinking (Read why PDCA is the engine of lean).Well done PDCA is a way of improving your way toward specific business needs. We have True North (a general concept of perfection), business plans, annual plans, and daily management. Then throughout the organization we want people using PDCA to find their best way of contributing to those business needs.
The business problems can be anything from a gap between current sales and what we need to sustain the business to a need to free up cash to pay our bills. Those problem statements would lead to very different actions. For example, eliminating the warehouse may or may not free up cash and it is unlikely to increase sales.
So I am concerned when people go on waste hunts to eliminate any waste they see. There is always waste, and there are always problems (gaps between our desired state and current state). We must prioritize our problems in some way. We must also find the best countermeasures we believe are feasible, cost effective, etc. to make a step toward closing a clear gap. Eliminating waste is not the goal. A warehouse one mile from the plant may increase inventory near the plant (waste), but reduce inventory of suppliers as well as lower logistics cost and improve reliability of delivery.
I would always subordinate a particular problem solving methodology to PDCA. Notice how Toyota Business Practices (above) is a disciplined process for following PDCA to attack any problem from large strategic issues (e.g., developing a new brand like Scion) to small problems (e.g., reduce waste at work stations to increase productivity).
Read More: Toyota, Just Really Good Problem Solvers: More about fighting wastes in new product development.
Dr. Jeffrey Liker is professor of industrial and operations engineering at the University of Michigan and author of The Toyota Way. He leads Liker Lean Advisors, LLC and his latest book (with Gary Convis) is The Toyota Way to Lean Leadership