The Toyota Way, also known as Lean, was born from hardship and survival. It is an approach that does not rely on the accidental fortunate circumstance of being in a positive business climate. The system that propelled Toyota to the top of the global automotive industry is designed to succeed in both good times and bad. Lean thinking fundamentally changes the engagement model between IT and the business, challenging traditional relationships with staff,customers and partners. This session, presented by a partnership between ThoughtWorks and KM&T, explains the Lean approach to challenges, continuous improvement, productivity, and quality, and how these principles can help you deliver high-value,high-quality software solutions to reduce operational costs, increase profitability, and survive. With presenters bringing deep expertise from Toyota, Lean and Agile principles, learn how to: -Identify and eliminate non-value adding work and cost (i.e., waste) -Build quality into processes to remove unnecessary rework -Apply Just-in-Time (JIT) principles to software delivery -Build processes that optimise use of resources and productivity for the entire end-to-end value stream -Engage everyone to continuously improve your team and practices -Understand the differences between repetitive processes, product development and software development Join us to discover how to do more with less. » » » » » » BRISBANE Tuesday 17 March, 2009 8am –- 9.30am Hilton 190 Elizabeth Street, Brisbane SYDNEY Tuesday 24 March, 2009 8am –- 9.30am Hilton 488 George Street, Sydney MELBOURNE Tuesday 31 March, 2009 8am –- 9.30am Marriott Cnr Exhibition & Lonsdale Streets, Melbourne PERTH Tuesday 7 April, 2009 8am –- 9.30am Hilton 14 Mill Street, Perth A light buffet breakfast will be provided * *

1. Quarterly Technology Briefing
“Lean Times Require Lean Thinking”
presented in partnership with

2. Lean Times Require Lean Thinking
Jason Yip
ThoughtWorks
Paul Heaton
KM&T
Image from http://www.bluefountainmedia.com/blog/?

3. steep recession in
that year, the Toyota Motor Company ran out of cash, which was
“As the Japanese economy entered a
tied up in inventory for products customers no longer wanted. The
company fell under the control of bankers who chopped the company in
two, creating separate firms to divide the marketing and sale functions from
the product development and production functions. (These firms were only
recombined in 1982 to create the current Toyota Motor Corporation.)
Founding president Kiichiro Toyoda (new president Akio
Toyoda’s grandfather) was driven out in the
process. The pursuit of what became the Toyota
Production System, along with the product development,
supplier management, and customer support systems, was the
creative response to this crisis.”
James Womack, Respect Science Especially in a Crisis,
http://www.manufacturingnews.com/news/09/0309/womack.html

4. Lean was born from hardship and
survival
• Free up scarce cash
• Reduce costs while
enhancing quality
• And very little time to
do this
http://www.flickr.com/photos/jtcatbagan/2420624616
/

5. What happened since then?

6. Toyota and Honda lead in J.D Power
quality ratings
In 2008, Toyota surpasses
GM as the world’s largest
auto maker

7. “Our recurring losses from operations,
stockholders' deficit and inability to
generate sufficient cash flow to meet
our obligations and sustain our operations
raise substantial doubt about our ability
to continue as a going concern”
General Motors SEC filing, 2009

8. Who would you rather be?

9. Is this really relevant to us?

11. Toyota success with the Prius
• Developed within 18
months.
• A typical competitor will
take 4 years
• Toyota used 150
engineers during
development.
• A typical competitor will
use 600 engineers.
Note: this includes designing
the Plant to produce it!!
Source - National Center for Manufacturing Sciences report

12. What message do I want to give?
• Lean Thinking is now becoming a
recognised world wide business model in
multiple sectors.
• It is not just all about Toyota Cars..!

13. Honda
New product development
Iterative and
Incremental
development
Toyota
Scrum
Kanban
Agile
Lean
Lean Software Development
XP

14. So, what is Lean?

15. Just-in-Time (not Just-in-Case)
The right material
At the right time
At the right place
In the exact amount

16. Stop The Line
“stop and fix problems
as they occur rather
than pushing them
down the line to be
resolved later”
Jeffrey Liker and David
Meier, Toyota Way
Fieldbook

17. The essence of Lean is engaging
everyone in identifying and solving
problems

18. Waste
Un-Evenness
workload that is
not balanced
Activities that do not
add value
Overburden
work that creates burden for the
team members or processes
Picture Source – Toyota Motor Company Australia

19. 8 WASTES
In LEAN 8 types of waste have been identified
These classifications have been adopted globally - for any process.
They apply equally to any process.
Not using
People
Resource
Waiting
Overproduction
Transport or
Conveyance
Motion
Stock &
Materials
Overprocessing
Rework
All of these 8 can be either
“Necessary Waste” or
“Un-necessary Waste”
Depending on circumstance

20. Waiting
Waiting is where people or materials are not being utilised because they are waiting
for another person or process to complete before work can resume.
Waiting
Examples:
 Waiting for patient records
 Waiting for medical staff
 Waiting for test results

21. Overproduction
Overproduction is where an excess of processes, or services are being created,
without there being any real requirement for them.
Overproduction
Examples:
 Sending the same letter to the
patient more than once
 Re-writing notes or forms because
of their illegibility

22. Transport or Conveyance
Unnecessary transportation of patients, stock, patient records and equipment which
is not reaching its end goal, adds no value. Too much transportation should be
avoided and is often the result of departments spaced far apart, or resources not
being closely linked.
Transport
or
Conveyance
Examples:
 Moving patients unnecessarily
from ward-to-ward
 Moving documents/patient records
from one department to another

23. Over-processing
Over-processing is where a process or person works hard, but not necessarily smart,
creating a waste which is not always easy to see, and can often be mistaken as part
of the process.
Overprocessing
Examples:
 Producing documents/charts/notes
which are never to be seen or used
 Performing more tests then are
necessary for a patient

24. Rework
Rework is where a process or procedure is not completed correctly the first time and
therefore needs to be re-done, or adjusted before it is deemed completed.
Examples:
Rework
 Producing multiple documents due
to incorrect information or errors
 Multiple tests or clinic dates for a
patient as correct information was not
collected or noted upon initial visit or
test

25. Stock
Stock = Materials in Stores (Medical equipment, Work-In-Process (WIP) & Finished Work)
Excess Stock = Cost (Cash)
Stock
Examples:
 Too many drugs at ward
 Uncontrolled material ordering

26. Motion
Motion is related to human movement. Good work area layout and process design
minimises the amount of movement and saves time & effort when finding or fetching
material or documents.
Motion
Example:
 Poor work area design, causing
unnecessary:
• Walking
• Bending
• Stretching

27. Resource
Resource is the most valuable asset in any business, without it, no business can
function or succeed successfully. The trick is to use the resource as they are the local
experts.
Examples:
Resource
• Not Listening
• Not Asking
• Not Empowering
• Not doing anything with generated /
suggested ideas

28. How does this fit with IT?

29. Understanding
of problem
space
Understanding
of solution
space
Focus
Business as
Usual
+++
(specification as
input)
+++
(focus on task
efficiency)
Cycle time +
cost reduction
Typical
projects
+
(iterative
specification)
++
(control what
needs to be
learned)
Earlier ROI
New Product
Development
?
(specification as
output)
?
(focus on
learning
efficiency)
Acquire and
exploit
knowledge
faster than
competitors

30. “Put yourself in the position of the customer
and ask if you would pay less for the product
or be less satisfied with it if a given step and its
necessary time were left out.”
Mike Rother and John Shook, Learning to See

31. Software development waste
1. Extra features (overproduction)
2. Delays (waiting)
3. Hand-offs (source of delays and defects, loss
of information)
4. Re-learning
5. Partially done work (obsolescence, not JIT)
6. Task switching (reduces throughput)
7. Defects (unnecessary rework)
8. Unused employee creativity

32. Non Value Add
“unnecessary wastes”
Waste to Eliminate!
Non Value Add
“necessary waste”
Waste to Reduce!
Value Add
Increase!

33. RENAL patients going through a Hospital Process
What is added
value to the
Customer
Look at End to End
Value Chain
Pictures provided courtesy of Agility Healthcare Solutions

34. Mapping the Process…
Source – NHS Centre for Innovation

35. 1
36 process steps
Who thinks that of the 36 steps:
2
3
4
5
6
10
7
8
9
100% -12
75% was added value activity?
11
13
14
15
16
17
18
19
75% - 50% was added value activity?
20
21
22
23
24
25
26
27
28
50% - 25% was added value activity?
29
30
31
32
33
34
Less than 25% was added value?
35
36
7 value add
29 process steps were non-value add or waste

36. •
•
•
•
•
•
•
Drive Cultural Change
People Engagement
Raise Problems in the moment
Cross Functional Team
Tracking Problems
Regular Disciplined Meetings
Responsibilities assigned

37. Perfectio
n
Flow
Wast
e
Valu
e
nt
eent
m
em
ovve
rro
Imp
Imp
aree
ccar
n tt
tieen
ti
aa
op
to p
t
ncee
eenc
ii
perr
xxpe
& ee
&
ous t
tinu en
n
Co ovem
r
mp
I
P – Plan
D – Do
C – Check
A - Act

38. Hospital Result…
ISSUE
ACTIVITY
RESULT
Renal patients
taking
FIFTEEN
days to get
through
process
Process Map
Team Work
Waste ID
Problem Solving
Project Mgt
Committed Leader
Waste reduction
allowed
sustainable
reduction to
EIGHT days

43. Set-based Concurrent Engineering

44. No problem is a problem

45. Authority-focus
• “Whose job is this?”
• “Not my problem”
Responsibility-focus
• “What is the right thing
to do?”
• “How can I help?”
“Managing to Learn” by John Shook

46. Daily standup meetings

47. Heartbeat retrospectives
• What did we do well, that if we don’t
discuss we might forget?
• What did we learn?
• What should we do differently next time?
• What still puzzles us?
http://www.retrospectives.com/pages/RetrospectiveKeyQuestions.html

48. Technique
Pairing
Test Driven
Development
Time to detect problem
Seconds
Seconds to minutes
Co-location
Seconds to minutes
Continuous Integration
~20 minutes to a couple
hours
User Stories
A couple days
Timeboxed development 1 – 4 weeks
Small releases
1 – 3 months

49. Just-in-Time is a response to the
problem of overproduction

50. Stop The Line is a response to the
problem of unnecessary rework
due to defects

51. The essence of Lean is engaging
everyone in identifying and solving
problems

52. What type of results are we talking
about?

53. McKinsey on Lean IT
“In our experience, applying the principles of
lean manufacturing to [application development
and maintenance] can increase productivity
by 20 to 40 percent while improving the
quality and speed of execution.”
N. Kindler, V. Krishnakanthan, R. Tinaikar,
“Applying lean to application development and
maintenance”, McKinsey on IT, Spring 2007

54. Forrester Research on
ThoughtWorks Agile/Lean
Category
Total defects
Critical defects
Effort
Duration
Improvement
63% less
79% less
62% less
69% less

55. So…what is required?
•
•
•
•
•
•
•
•
A Clear Customer Focused Vision
Sustained Leadership Commitment
People Engagement / Role Clarity / Skills Developed
Structure Process & Project Management
Change Champions
A Sense of Urgency
Appropriate Activity Monitoring
Appropriate HR Policies

57. What’s next?
•
•
•
•
•
Start where you are
Don’t shy away from your problems
Go and see
Think
And ask for help

58. For Further Information please contact:
ThoughtWorks – Jason Yip
Email
Web
jcyip@thoughtworks.com
www.thoughtworks.com.au
KM&T – Paul Heaton
mail
pheaton@kmandt.com.au
Web
www.kmandt.com.au