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Problem Solvers
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Toyota's reputation for sustaining high product quality is legendary. But the
company's methods are not secret. So why can't other carmakers match Toyota's
track record? HBS professor Steven Spear says it's all about problem solving.
by Sarah Jane Johnston
When HBS professor Steven Spear recently released an abstract on problem
solving at Toyota, HBS Working Knowledge staffer Sarah Jane Johnston emailed off some questions. Spear not only answered the questions, but also
asked some of his ownand answered those as well.
Sarah Jane Johnston: Why study Toyota? With all the books and articles on
Toyota, lean manufacturing, just-in-time, kanban systems, quality systems, etc.
that came out in the 1980s and 90s, hasn't the topic been exhausted?
Steven Spear: Well, this has been a much-researched area. When Kent Bowen
and I first did a literature search, we found nearly 3,000 articles and books had
been published on some of the topics you just mentioned.
However, there was an apparent discrepancy. There had been this wide, longstanding recognition of Toyota as the premier automobile manufacturer in terms
of the unmatched combination of high quality, low cost, short lead-time and
flexible production. And Toyota's operating systemthe Toyota Production
Systemhad been widely credited for Toyota's sustained leadership in
manufacturing performance. Furthermore, Toyota had been remarkably open in
letting outsiders study its operations. The American Big Three and many other
auto companies had done major benchmarking studies, and they and other
companies had tried to implement their own forms of the Toyota Production
System. There is the Ford Production System, the Chrysler Operating System,
and General Motors went so far as to establish a joint venture with Toyota called
NUMMI, approximately fifteen years ago.
However, despite Toyota's openness and the genuinely honest efforts by other
companies over many years to emulate Toyota, no one had yet matched Toyota
in terms of having simultaneously high-quality, low-cost, short lead-time, flexible
production over time and broadly based across the system.
It was from observations such as these that Kent and I started to form the
impression that despite all the attention that had already been paid to Toyota,
something critical was being missed. Therefore, we approached people at Toyota
to ask what they did that others might have missed.
Q: What did they say?
A: To paraphrase one of our contacts, he said, "It's not that we don't want to tell
you what TPS is, it's that we can't. We don't have adequate words for it. But, we
can show you what TPS is."
Over about a four-year period, they showed us how work was actually done in
practice in dozens of plants. Kent and I went to Toyota plants and those of
suppliers here in the U.S. and in Japan and directly watched literally hundreds of
people in a wide variety of roles, functional specialties, and hierarchical levels. I
personally was in the field for at least 180 working days during that time and
even spent one week at a non-Toyota plant doing assembly work and spent
another five months as part of a Toyota team that was trying to teach TPS at a
first-tier supplier in Kentucky.
Q: What did you discover?
A: We concluded that Toyota has come up with a powerful, broadly applicable
answer to a fundamental managerial problem. The products we consume and the
services we use are typically not the result of a single person's effort. Rather,
they come to us through the collective effort of many people each doing a small
part of the larger whole. To a certain extent, this is because of the advantages of
specialization that Adam Smith identified in pin manufacturing as long ago as
1776 in The Wealth of Nations. However, it goes beyond the economies of scale
that accrue to the specialist, such as skill and equipment focus, setup
minimization, etc.
The products and services characteristic of our modern economy are far too
complex for any one person to understand how they work. It is cognitively
overwhelming. Therefore, organizations must have some mechanism for
decomposing the whole system into sub-system and component parts, each
"cognitively" small or simple enough for individual people to do meaningful work.
However, decomposing the complex whole into simpler parts is only part of the
challenge. The decomposition must occur in concert with complimentary
mechanisms that reintegrate the parts into a meaningful, harmonious whole.
This common yet nevertheless challenging problem is obviously evident when we
talk about the design of complex technical devices. Automobiles have tens of
thousands of mechanical and electronic parts. Software has millions and millions
of lines of code. Each system can require scores if not hundreds of person-workyears to be designed. No one person can be responsible for the design of a
whole system. No one is either smart enough or long-lived enough to do the
design work single handedly.
Furthermore, we observe that technical systems are tested repeatedly in
prototype forms before being released. Why? Because designers know that no
matter how good their initial efforts, they will miss the mark on the first try. There
will be something about the design of the overall system structure or architecture,
the interfaces that connect components, or the individual components
themselves that need redesign. In other words, to some extent the first try will be
wrong, and the organization designing a complex system needs to design, test,
and improve the system in a way that allows iterative congruence to an
acceptable outcome.
The same set of conditions that affect groups of people engaged in collaborative
product design affect groups of people engaged in the collaborative production
and delivery of goods and services. As with complex technical systems, there
would be cognitive overload for one person to design, test-in-use, and improve
the work systems of factories, hotels, hospitals, or agencies as reflected in (a)
the structure of who gets what good, service, or information from whom, (b) the
coordinative connections among people so that they can express reliably what
they need to do their work and learn what others need from them, and (c) the
individual work activities that create intermediate products, services, and
information. In essence then, the people who work in an organization that
produces something are simultaneously engaged in collaborative production and
delivery and are also engaged in a collaborative process of self-reflective design,
"prototype testing," and improvement of their own work systems amidst changes
in market needs, products, technical processes, and so forth.
A: Your question cuts right to a critical issue. We discussed earlier the basic
problem that for complex systems, responsibility for design, testing, and
improvement must be distributed broadly. We've observed that Toyota, its best
suppliers, and other companies that have learned well from Toyota can
confidently distribute a tremendous amount of responsibility to the people who
actually do the work, from the most senior, expeirenced member of the
organization to the most junior. This is accomplished because of the tremendous
emphasis on teaching everyone how to be a skillful problem solver.
Q: How do they do this?
A: They do this by teaching people to solve problems by solving problems. For
instance, in our paper we describe a team at a Toyota supplier, Aisin. The team
members, when they were first hired, were inexperienced with at best an average
high school education. In the first phase of their employment, the hurdle was
merely learning how to do the routine work for which they were responsible.
Soon thereafter though, they learned how to immediately identify problems that
occurred as they did their work. Then they learned how to do sophisticated rootcause analysis to find the underlying conditions that created the symptoms that
they had experienced. Then they regularly practiced developing countermeasureschanges in work, tool, product, or process designthat would
remove the underlying root causes.
Q: Sounds impressive.
A: Yes, but frustrating. They complained that when they started, they were
"blissful in their ignorance." But after this sustained development, they could now
see problems, root down to their probable cause, design solutions, but the team
members couldn't actually implement these solutions. Therefore, as a final round,
the team members received training in various technical craftsone became a
licensed electrician, another a machinist, another learned some carpentry skills.
Q: Was this unique?
A: Absolutely not. We saw the similar approach repeated elsewhere. At Taiheiyo,
another supplier, team members made sophisticated improvements in robotic
welding equipment that reduced cost, increased quality, and won recognition with
an award from the Ministry of Environment. At NHK (Nippon Spring) another
team conducted a series of experiments that increased quality, productivity, and
efficiency in a seat production line.
Also, we've been testing these ideas with our students: Kent in the first year
Technology and Operations Management class for which he is course head, me
in a second year elective called Running and Growing the Small Company, and
both of us in an Executive Education course in which we participate called
Building Competitive Advantage Through Operations.
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