This month’s book is The Toyota Way to Service Excellence: Lean Transformation in Service Organizations by Jeffrey Liker and Karyn Ross.
“A culture of service excellence is a slow build, takes constant vigilance to sustain, but is the only true path to greatness.”
If your idea of a business book is 3 concepts stretched to fill 150 pages – this is not that book.
Instead of an “airport speed-read,” The Toyota Way to Service Excellence is more of a graduate course – with great professors! This makes sense since Dr. Jeffrey Liker has been a professor for over 30 years. Co-author Karyn Ross brings real and imagined examples to life with her hands-on experience in the service sector. Together, these Shingo-Prize winners carefully and thoughtfully apply the principles and practices of Toyota to call centers, hospice care, mail order, taxi service, IT development and beyond.
For those unfamiliar, Jeffrey Liker wrote the original The Toyota Way: 14 Management Principles From the World’s Greatest Manufacturer back in 2004. The Toyota Way was published internally in 2001, but his 2004 book codified the “secret sauce” inside Toyota City. His efforts were greatly honored by Toyota leadership who had been living the Toyota Way for many years.
Fantastic Case Studies
The authors use an imaginary case study to outline a clear path to applying The Toyota Way to a service process. They also weave in real examples from actual businesses they’ve both worked with. What’s fascinating about the real companies is how strikingly different their cultures are. They detail incredible success stories, but the organizations have done it their own way. You can get great ideas or just shots of inspiration from each one of them.
- Zingerman’s hilarious list of “Five Ways to Lose a Customer” will ring a warning bell for anyone who’s been an online customer (hmmm – that covers a lot of us).
- Menlo Innovations: Their “mission as an organization is to end human suffering in the world as it relates to technology…” – They’re so confident in the value they bring to their clients, they’ll take ½ their compensation in equity. They’ve made millions doing that!
- Tyson and Sarah Ortiz: They applied “Improvement Kata” (using the scientific method as a routine practice) as a way to work with the hospital and doctors trying to save their newborn son – He’s now a happy, active little 3-year-old.
These and other stories bring The Toyota Way to life in the best way.
What’s fascinating about the real companies is how strikingly different their cultures are. They detail incredible success stories, but the organizations have done it their own way.
What Exactly Is “Service”?
The authors point out that the definition of service is tricky. If you consider the hospitality sector, there are processes that obviously qualify as service within a hotel – being checked in by a front desk clerk is a good one. But if you consider the banqueting process where hundreds of meals are constructed, served and then cleared, it resembles assembly line work.
It’s better to “consider differences across functional groups within manufacturing and service systems, or even difference in individual jobs, than it is to treat manufacturing and service organizations as different animals.”
On the manufacturing side, once you look at their call centers you are back in a “service” process. They conclude that it’s better to “consider differences across functional groups within manufacturing and service systems, or even difference in individual jobs, than it is to treat manufacturing and service organizations as different animals.”
Adapting The Toyota Way for service processes turns out to be important for the country. They point out that based on U.S. Bureau of Labor Statistics, “by 2022 the service sector will account for 90 percent of the jobs that will be added to the American economy.” Lean is not just for manufacturing (see the review of We Don’t Make Widgets), and this book helps to further dispel that myth while at the same time providing guidance for how to support our growing economy.
Lean is not just for manufacturing, and this book helps to further dispel that myth.
The 4 Ps of the Toyota Production System Adapted for Service
The framework builds on Dr. Liker’s 2004 book by adding adaptations for service organizations.
- Philosophy: It’s key to clarify the purpose of the organization. What is the thing of value they are providing to customers? Money is just a by-product so organizations must take the long view – focusing on quarterly success won’t help build service excellence.
- Process: Create an ideal process through the eyes of the customer. Create a macro-view of the ideal value stream and then break it down to the micro-level and apply Plan-Do-Check-Act to achieve success.
- People: Actively develop people by challenging them to continuously improve themselves and the process while simultaneously coaching them to success. Work horizontally across functional boundaries to maintain customer focus.
- Problem Solving: Systematically work toward the ideal state of the process as opposed to reactively fixing process issues as they arise. Use Plan-Do-Check-Act at all levels- enterprise and organizational units – to maintain alignment.
Based on Organic vs. Mechanistic Thinking
Much of the philosophy behind The Toyota Way can summed up this way: Mechanistic thinking is short-term, linear and requires experts to find the right solutions. Organic or systems thinking refers to taking a long-term approach, treating organizations as complex, interconnected networks where everyone is involved in experimenting to learn and evolve. “There is no generic ‘recipe’ or ‘best-practice way’ to mechanically ‘install’ or ‘implement’ Lean in an organization.”
The systems thinking approach is, not surprisingly, complex. There’s no easy fix and it requires dedication, focus and time. “Senior leaders must understand that improvement is not a ‘program’ but a philosophy that connects their people, processes, systems, and customers together in an organic, living system.” The authors see the downside of mechanistic thinking all around them in failed improvement efforts.
Senior leaders must understand that improvement is not a ‘program’ but a philosophy that connects their people, processes, systems, and customers together in an organic, living system.
There are lots of “ahas” throughout the book. These nuggets are true and useful regardless of the size of the improvement effort.
- Waste is Stagnation – This ties the idea of removing waste to the goal of improving process “flow.” Look for where the flow is “stagnating” and then look for ways to remove what’s blocking it.
- Current Best Way – The idea is that labeling a routine as a “Best Practice” makes it sound as if there’s nothing more to be done. If you change the label to “Current Best Way” then the method is temporary – you can always do better.
- Meet Leaders in the Workplace (Gemba) – Karyn Ross developed this technique to help leaders transition from managing at a distance to truly understanding how value is created for their customers. They have to “get amongst it.”
What Not to Do
Below are some of the reasons organizations fail when trying to duplicate Toyota’s success.
- Using Tools for Tools Sake: Focusing on “waste” as the enemy as opposed to clarifying how that will enable the organization to fulfill their purpose
- Focusing on the ROI: Implementing a fast, efficient Lean rollout (usually at the hands of a “big box consulting firm”) instead of establishing a successful pilot effort and growing organically from there
- Focusing on Training Alone: Using training alone to teach people instead of applying the tools and concepts in the workplace to drive home learning
- Separating Leaders from Improvement: Leadership running Lean efforts at a distance as opposed to becoming integral parts of the process improvement
- Trying to Replicate Toyota: Trying to imitate specific solutions instead of working to determine what’s best for a specific organization or process – you can’t imitate a culture, you have to develop your own
Along with cautionary tales, the authors offer lots of helpful advice on what does work and great examples of how it happened elsewhere. They caution against pre-packed solutions but they offer a good high-level, generic approach.
Generic Approach to Adopting the Toyota Way
- Be sure that senior leadership is serious about the need for change – Is there a burning platform or a leader who simply believes in improvement?
- Understand senior leadership vision – How does leadership want to use Lean as a way to reach their objectives?
- Grasp the situation – How is the business performing and what’s the current culture?
- Understand the current state – What’s the main business challenge to leverage?
- Identify gaps and prioritize – What are the manageable pieces to start working on right away?
- Strive for the future state through small cycles of learning – Keep using Plan-Do-Check-Act to interactively learn, grow and develop the habit of improvement
The book is a wonderful education full of the authors’ experience with typically frustrating corporate behavior. This will resonate with anyone trying to build an improvement culture in their workplace. But for every failed attempt at Lean, they provide you with a glimpse of greatness. The culture of Menlo Innovations will truly lift your spirits. Zingerman’s will make you laugh. You’ll come away with dozens of new ideas, you’ll be ready for some “slow” thinking… and maybe a gift basket.
[This book] will resonate with anyone trying to build an improvement culture in their workplace.
About the Authors:
Dr. Jeffrey K. Liker is Professor of Industrial and Operations Engineering, University of Michigan and a professional speaker and advisor through his company Liker Lean Advisors, LLC.
He is author of the international best-seller, The Toyota Way: 14 Management Principles From the World’s Greatest Manufacturer, and the companion (with David Meier) Toyota Way Fieldbook, Mcgraw Hill, 2005. He has co-authored a number of author books, The Toyota Product Development System, Toyota Talent: Developing Exceptional People the Toyota Way, Toyota Culture: The Heart and Soul of the Toyota Way, The Toyota Way to Lean Leadership, The Toyota Way to Continuous Improvement, Toyota Under Fire and Developing Lean Leaders at All Levels: A Practical Guide.
His articles and books have won eleven Shingo Prizes for Research Excellence and The Toyota Way also won the 2005 Institute of Industrial Engineers Book of the Year Award and 2007 Sloan Industry Studies Book of the Year. He is a frequent keynote speaker and in 2012 he was inducted into the Association of Manufacturing Excellence Hall of Fame.
Karyn Ross is the Shingo Award-winning coauthor of The Toyota Way to Service Excellence: Lean Transformation in Service Organizations. Her business, Karyn Ross Consulting, was created to help businesses flourish, thrive and grow by focusing on service excellence.
An internationally experienced consultant, coach and lean practitioner, she has taught organizations of all sizes in sectors as diverse as insurance, HR, transportation and retail how to use creativity combined with Toyota Way principles – a combination she calls, “Practical Creativity.”
Karyn is also a practicing artist with an MFA in Sculpture.
Practical Tools and Concepts Covered:
- Standard Work
- Autonomation (Jidoka)
- Policy Deployment (Hoshin Kanri)
- Waste (Muda)
- Improvement Routine (Improvement Kata)
- Coaching Routine (Coaching Kata)
Who Should Read The Toyota Way to Service Excellence?
- Service sector employees
- Lean Practitioners
- Process Improvement Professionals
- Change Agents
- Champions/Sponsors, Master Black Belts, Black Belts, Green Belts, Yellow Belts and White Belts
From the Page:
“Lean is a way of thinking centered on the twin pillars of respect for people and continuous improvement…. If we want a culture that respects people, starting with customers, and continuously improves, we need leaders at all levels leading this through their actions, which includes developing people to truly care about customers and build the skills of improvement.”