tag:blogger.com,1999:blog-16811523446975688192012-02-16T16:21:53.391-08:00The blog of Tom Jackson, author of Hoshin Kanri for the Lean EnterpriseTom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.comBlogger381100tag:blogger.com,1999:blog-1681152344697568819.post-10139206773586084802009-11-22T21:05:00.000-08:002009-11-23T02:07:01.993-08:00

Tom Jackson Portland, Oregon November 22, 2009 I have often wondered about the parable of the loaves and fishes (Mark 6:30-44) in which Jesus and his disciples feed five thousand with just five loaves of bread and only two fishes. I believe that it may be a tale told by an economist, at least an economist at heart, and a very smart one. Overlooking for the moment the very meager number of loaves

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com0tag:blogger.com,1999:blog-1681152344697568819.post-91312549946818967942009-11-15T03:01:00.000-08:002009-11-15T11:40:39.355-08:00

Thomas L Jackson, JD, MBA, PhD Portland, Oregon, USA November 15, 2009 I finally solved a puzzle I've been working on for a long time. Followers of this blog will know that I contend that radical decentralization and the control system of hoshin kanri define a new type of organization that solves problems in real time. I call it the C-form or Cybernetic Form. The economic theory upon which my

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com2tag:blogger.com,1999:blog-1681152344697568819.post-19505111109283888832009-10-26T21:25:00.000-07:002009-10-27T00:50:54.879-07:00

Tom Jackson Portland, Oregon 26 October 2009 What is hoshin kanri? It is, essentially, a way to create a new organizational structure. What is organizational structure? According to economists like the new Nobel Laureate, Oliver Williamson (see my previous post), organizational structure is a structure for processing information. This makes complete sense if we stop but a moment to consider

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com2tag:blogger.com,1999:blog-1681152344697568819.post-12071409396705862032009-10-15T03:29:00.000-07:002009-10-15T03:29:07.560-07:00

Although I have never met Professor Williamson, who won a Nobel Prize for Economics this week, I have long been under his influence. I was very broadly educated in the New Institutional Economics at Indiana University (no, I didn't study with this year's other winner, Professor Elinor Ostrom, of, oh yes, Indiana University), where I was tutored by the late Professor David Martin in Williamson's

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com0tag:blogger.com,1999:blog-1681152344697568819.post-36102863147227454672009-10-08T06:53:00.000-07:002009-10-08T21:55:02.690-07:00

As I watch Toyota's leadership go through its latest bout of hansei (deep reflection), I am struck again by how conservative Toyota is. Compare Toyota's apology for it floormats to how Ford swept the Pinto's exploding gas tanks under the carpet! Is this profoundly conservative attitude rooted in Japanese culture? Well, maybe. Or maybe it's rooted in modern portfolio theory. All of us have

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com1tag:blogger.com,1999:blog-1681152344697568819.post-46890725314578911122009-09-30T16:43:00.000-07:002009-09-30T16:43:00.215-07:00

A cubist painting, such as Picasso's Three Musucians, pictured here, was intended to convey in two dimensions all of the essential information about a three dimensional object or event. Some observors saw something more, namely, a version of reality from multiple perspectives. Picasso's Three Musicians Consider Picasso's painting, Violin and Guitar,  and you can see for yourself how these

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com2tag:blogger.com,1999:blog-1681152344697568819.post-28617171640514077612009-09-29T10:48:00.000-07:002009-09-29T10:57:20.164-07:00

Why is hoshin so powerful? People will tell you that it's the best way to get a company focused. No kidding! But what does "focus" mean, apart from powerpoint slides that show all of our "arrows" pointed in the same direction. It may be helpful to think of focus as the opposite of diversification. Diversification is what we do to minimize the risk in our portfolios of stocks and bonds.

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com0tag:blogger.com,1999:blog-1681152344697568819.post-79287429671255411372009-09-26T08:49:00.000-07:002009-09-27T02:37:04.845-07:00

Tom Jackson Monterrey, Mexico I spent the past week in Mexico, where I made a presentation about hoshin kanri and the A3 system to the Annual Shingo Prize Conference of Mexico. In preparing for my talk, I searched for a way to connect with my Spanish-speaking audience. I recalled my recent reading of Cervantes' great novel, Don Quixote. Of course it is only coincidental that there is an "x" in

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com1tag:blogger.com,1999:blog-1681152344697568819.post-86553482921006936332009-09-21T01:50:00.000-07:002009-09-21T02:52:24.946-07:00

Hoshin kanri lowers the cost of doing business. Why? The reason is twofold: Organizations are a nexus of contracts; and Hoshin kanri results in what economists call "complete" contracts. Before we go any further, let me be very clear: A3s are contracts. Moreover, hoshin kanri is essentially a method for creating and enforcing A3 contracts. (The principal A3 is Toyota's Proposal A3, which is

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com1tag:blogger.com,1999:blog-1681152344697568819.post-26774218411175413322009-09-15T21:45:00.000-07:002009-09-19T15:22:35.400-07:00

Twenty years ago, Robert Kaplan of the Harvard Business School and his business partner David Norton witnessed Analog Device's implementation of hoshin kanri and the result was the Balanced Scorecard. Of course the Balanced Scorecard was wildly popular and made many consultants a lot of money. But, the Balanced Scorecard is not hoshin kanri. This remains true despite Kaplan and Norton's dogged

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com1tag:blogger.com,1999:blog-1681152344697568819.post-74389024794907960892009-09-01T18:25:00.001-07:002009-09-02T00:51:12.962-07:00

In my last post I argued in favor of optimizing returns in business by minimizing the risk of failing to meet quality, cost and delivery targets. And to blazes with profit maximization. This post is an addendum. I wish to point out that my position is already implicit in the so-called balanced scorecard. (My readers will know that the balanced scorecard is largely derived from hoshin kanri.)

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com1tag:blogger.com,1999:blog-1681152344697568819.post-81968955354670637812009-08-31T08:35:00.000-07:002009-09-01T17:37:19.512-07:00

Its a paradox. On a daily basis we live with two conflicting ideas: the concept of profit maximization on the one hand and portfolio optimization on the other hand. On the one hand, many of us are business types who want to make more; perhaps we want to make as much as we possibly can. That makes us profit maximizers. On the other hand, we all have (underperforming) portfolios of stocks and

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com0tag:blogger.com,1999:blog-1681152344697568819.post-92228974244897266102009-08-08T07:37:00.000-07:002009-08-09T01:55:32.355-07:00

Recently I have been doing most of my shopfloor work in healthcare. To quote Yankee great, Yogi Berra: It's deja vu all over again.Today I visited the IHI's (Institute for Healthcare Improvement) web site, where it's gifted President, Donald Berwick, advocates for evidence-based medicine and lean healthcare. It is already a veritable encyclopedia of best practices. And that's the problem.The

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So--46 years after Toyota adopted hoshin kanri as its management system--why haven't American execs copped on to it? And this despite the huge, huge success of the Balanced Scorecard (or at least the success of Balanced Scorecard consultants), derived as the Balanced Scorecard was from Analog Devices' implementation of hoshin kanri... Not to mention the success of Six Sigma's Breakthrough

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com1tag:blogger.com,1999:blog-1681152344697568819.post-48661667869341630762009-08-03T22:18:00.000-07:002009-08-03T22:52:27.858-07:00

Hoshin kanri and the A3 system is how Toyota manages its vaunted production system. John Shook stated in Becoming Lean (Productivity Press) that hoshin kanri is as important as the production system. Well, we've been tying our best to adopt the production system for over twenty years. How long will it take the business world to adopt Toyota's management system?Is history any guide?In the 1920s,

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com1tag:blogger.com,1999:blog-1681152344697568819.post-46194174231033689342009-08-01T01:24:00.000-07:002009-08-03T02:55:12.755-07:00

This is a post about the economics of hoshin kanri.Over ten (10) years ago, lean guru John Shook stated in Becoming Lean that hoshin kanri--Toyota's management methodology--is just as important as Toyota's just-in-time production. Why this is true is still not well understood. Alas, this is a function of our so-called higher education system, which has failed to equip the present generation of

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com0tag:blogger.com,1999:blog-1681152344697568819.post-53739100575571994092009-07-30T18:43:00.000-07:002009-07-30T18:57:23.414-07:00

Today a favorite client turned the tables on me. I am still absorbing the impact.I had called my friend to ask him to become a contributor to a new blog (subject: lean healthcare) that I plan to launch next month. In the last fifteen months I helped my client through a major implementation of hoshin kanri in which over 50 A3s were generated by as many managers, and which--I am proud to report--

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com0tag:blogger.com,1999:blog-1681152344697568819.post-7638113514010734382009-07-27T06:53:00.000-07:002009-07-27T07:12:27.174-07:00

I learned from a student of mine the other day that her company was using A3s. 3 cheers! Maybe her company is even doing hoshin kanri (aka policy deployment). Then she told me that the value stream mapping exercise we had just completed was exactly what her company needed on the front line.I thought immediately of a few of my clients who have invested heavily in the Balanced Scorecard, which too

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com0tag:blogger.com,1999:blog-1681152344697568819.post-34091866988541945012009-07-21T22:41:00.000-07:002009-07-21T23:13:51.121-07:00

Many advocates of the A3 process, John Shook among them, swear by hand drawn A3s, and so do I, up to a point.It's about the creative right brain, really. Numbers and computers can be so limiting. Better to draw stick figures and scribble problem statements in long hand script. Use pencil, naturally.But one of the major objectives of drafting an A3 is to create systems of measurement. This implies

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com0tag:blogger.com,1999:blog-1681152344697568819.post-75841566655133919462009-07-21T01:52:00.000-07:002009-07-21T03:09:04.189-07:00

Much is made of the "A3 process." So, what is it?There are at least six answers to this question:The "missing link" of the Toyota Production System. The A3 process is an integral component of hoshin kanri, or policy deployment. Hoshin kanri (or "hoshin" for short, is the "missing link" (as it were) of the Toyota Production System. As I have stated in previous blogs, hoshin is also known as the "

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com0tag:blogger.com,1999:blog-1681152344697568819.post-17307256388046698482009-07-19T03:15:00.000-07:002009-07-19T11:22:35.075-07:00

H. Thomas Johnson, author (along with Anders Broms) of the Shingo Prize-winning Profit Beyond Measure, tells us that Toyota does not permit accountants on the shop floor. How is that? Well, the first reason is of course standard work, which requires that every operation is standardized as to task, sequence, time, and work in process inventory. The second reason is Zero Quality Control, which

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com0tag:blogger.com,1999:blog-1681152344697568819.post-31220231817086491682009-07-14T18:44:00.000-07:002009-07-14T21:20:52.888-07:00

Chris Argyris, the father of organization learning theory, once said (I paraphrase) that a learning organization is one that finds defects and fixes them. That's interesting.How might we measure that?When we measure intelligence in humans, we normally seek to find out how many questions a person can answer correctly within a certain time frame. In other words, intelligence is measured by how fast

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com0tag:blogger.com,1999:blog-1681152344697568819.post-15647933478054819482009-07-08T21:03:00.000-07:002009-07-08T21:52:12.578-07:00

Here are a few tips on how to draft great A3 team charters.First, undertand what A3s are all about. A3s define projects intended either to etablish standard work where there is none, or to adjust standard work that is not delivering the expected or required results. A3 team charters define these projects in all their essential details. Normally, A3s include a problem or "issue" statement that

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com0tag:blogger.com,1999:blog-1681152344697568819.post-61078308368490731632009-06-29T23:39:00.000-07:002009-06-30T00:19:37.405-07:00

Economists view organizations something like giant computers that solve problems by executing "programs" that take the form of step-by-step methods. These methods are broadly known as technologies and include "hard" technologies, like steelmaking, but also include the "soft" technologies of the service industries, including healthcare. Different types of organizational structures are graded

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com0tag:blogger.com,1999:blog-1681152344697568819.post-11940178495830877372009-04-28T21:30:00.000-07:002009-04-30T09:55:56.684-07:00

At the Rona Consulting Group (see "sister sites" at the left), my partners and I help health care organizations transform themselves into quality-conscious institutions capable of making money by employing the principles of the Toyota Management System. Most of the activities we undertake involve teams chartered using Toyota's famous A3 knowledge management system (after which this humble blog is

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com0tag:blogger.com,1999:blog-1681152344697568819.post-26800428254540045232009-04-27T01:12:00.000-07:002009-04-28T10:41:17.036-07:00

This post is a continuation of "The paradox of the Panopticon," posted on April 25, 2009...The way out of the Panopticon is through organizational redesign and transformation based upon the Toyota Way. In other words, to escape the Panopticon, we must transform organizations into lean enterprises, which have two critical features:Radical decentralization of decision making; andCybernetic control

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com0tag:blogger.com,1999:blog-1681152344697568819.post-76057651143789572072009-04-25T01:01:00.000-07:002009-04-25T16:00:36.579-07:00

In his book, Discipline and Punish (1975), French philosopher Michel Foucault characterized modern organization as a Panopticon, a special type of prison. The brainchild of British utilitarian, Jeremy Bentham, the design of the Panopticon gives its Warden complete control over his Prisoners through a clever combination of spatial organization and mirrors. From his exalted place at the center, the

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com0tag:blogger.com,1999:blog-1681152344697568819.post-20904719712818876982009-04-24T05:06:00.000-07:002009-04-24T06:05:26.403-07:00

Lean management consultants who specialize in the Toyota Way always say, "Go to Gemba." Gemba is the real place, the here and now, where life actually happens. The reason that we must go to Gemba is because, if--as managers--we rely upon computerized databases or abstract reports, we can never be sure that we actually know what is happening. Regardless of the millions, or hundreds of millions of

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Toyota, more famous for its production system than its organizational structure, has operated a highly successful matrix or "cross-functional" organization since the early 1960s. Theoretically, matrix organizations should be better at solving complex problems requiring a multidisciplinary approach. Toyota uses its matrix to routinely reduce its operating costs as well as solve quality problems.

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com0tag:blogger.com,1999:blog-1681152344697568819.post-2006055738347116072009-04-22T06:24:00.000-07:002009-04-22T06:33:02.275-07:00

To my readers, who may have noticed a lapse in my blogging, the fault is not all mine. Although I have been an avid Apple fan ever since I bought a Mac SE 30 and matching portrait monitor in 1988, I was recently disappointed in Apple by the odd failure of its otherwise wonderful iWeb software. iWeb's blogging program has a bug that deposits unwanted text above the blog header--like a fly on the

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Steven Spear and H. Kent Bowen did an admirable job of describing what makes Toyota tick in their Shingo Prize-winning article, “Decoding the DNA of the Toyota Production System,” Harvard Business Review, Sept.-Oct., 1999. In that article they defined four “rules” that described how Toyota’s production workers carry our their activities (Rule 1), make connections between customers and suppliers (

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com0tag:blogger.com,1999:blog-1681152344697568819.post-84311117034009899362009-04-22T06:04:00.000-07:002009-04-22T06:05:19.465-07:00

H. Thomas Johnson writes in To Become Lean, Shed Accounting, that Toyota does not allow accountants on the shop floor. It is no wonder. What would be the purpose? Everything is already under control. Accountants on the shop floor would be, well, muda or waste.To be more specific, Toyota’s standard work controls six basic things:exactly how each task in a process is performed,the sequence of such

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com0tag:blogger.com,1999:blog-1681152344697568819.post-23536412406803214122009-04-22T06:03:00.002-07:002009-04-22T06:04:26.656-07:00

Why is takt time so easy on the one hand and yet so difficult on the other. Everyone understands the simple concepts of the seven deadly wastes. Everyone understands the simple idea of working to the “beat” of the market. Few people have difficulty drawing a current state value stream map. But ask people to understand FIFO lande, supermarkets, and heijunka? What has your experience been?I believe

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com0tag:blogger.com,1999:blog-1681152344697568819.post-49808358391809453872009-04-22T06:03:00.001-07:002009-04-22T06:03:28.704-07:00

Most lean consultants will tell you that lean enterprise is about three things: material flow; material flow; material flow. And this makes sense, that is, until you think about it. As we know, lean manufacturing techniques have been successfully applied to many nonmanufacturing processes, most recently to healthcare. So obviously whatever lean is about, it is about information as well as

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com0tag:blogger.com,1999:blog-1681152344697568819.post-73368145921634598202009-04-22T06:01:00.000-07:002009-04-22T06:02:21.822-07:00

Lean management boils down to two innovations in organizational structure and management control:The radical decentralization of decision making; andA cybernetic financial control system, known as profit management.Radical decentralizationRadical decentralization is the empowerment of the entire workforce to find defects and fix them, and the quicker the better! It is most simply described as the

Tom Jacksonhttp://www.blogger.com/profile/03338815561789573249noreply@blogger.com0tag:blogger.com,1999:blog-1681152344697568819.post-76288155792795864062009-04-22T06:00:00.000-07:002009-04-22T06:01:31.221-07:00

The strange connection between lean enterprise and antitrust lawSimon Johnson, a rising star in the world of recession/depression commentators, stated on a recent appearance on Terry Gross’s essential NPR (National Public Radio) program, Fresh Air, that the current economic meltdown warrants a revision of U.S. antitrust law. See Johnson’s lively blog, Baseline Scenario. This caught my attention.

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So, mighty Toyota is asking for handouts, a $2 billion handout from the Japanese government and a loan from the European Investment Bank. See Ian Rowley’s recent Business Week article, Auto Bailout: Et tu, Toyota?).This is all very disappointing, especially to management consultants like myself who have championed Toyota’s approach to managing business. I suppose that we believed that, faced with

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General Motors reinvented the modern corporation in the 1920s. Today, GM is facing the end of business as usual, to put it mildly.Many people think that Toyota’s famous just-in-time production system is to blame. And it is a fact that GM, Ford, and Chrysler never implemented just-in-time completely, except in a few of their factories. I should know. I was a member of Ford’s Lean Advisory Board,

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