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Holacracy in Zappos, Lean Production in Toyota

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Study of Holacracy and lean production in Zappos and Toyota respectively.

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Holacracy in Zappos, Lean Production in Toyota

  1. 1. Strategic Operational Management Assessment 2: Case Study Presentation Student: Raju Lama (Yib00004yz) Accessor: Milton D’Souza Date: 21st March, 2019
  2. 2. Overview • Zappos - Adaptation of holacracy in Zappos - Generic business-level strategy - Functional level strategy • Virginia Mason Hospital (VMH) - Lean production (LP) philosophy - LP implementation in VMH • Solver “What if” Analysis for Cycle Trader • Overall Equipment Effectiveness (OEE) in XYZ Ltd company.
  3. 3. Ans 1(a) Why Zappos adopted Holacracy ? • To change management style Break the traditional management style of high hierarchy and distribute more authority down the hierarchy. • To make employee efficient Freedom with responsibility brings creativity, productivity and accountability. Learn self-management. • To gain market Share Making Zappos very responsive to market change, grab customer demand and provide better customer service.
  4. 4. Ans 1(b) Holacracy Impact on Zappos Organizational Culture • Negative - Employee resisted for radical (fast) changes in the organization. - 14% employee quitted Zappos • Positive - Employed who stayed believed in Tony’s vision and embrace the changes. - Distributed more authority down the hierarchy which improved communication inside and outside Zappos.
  5. 5. Ans 2(a) Zappos Business-level Strategy i. Cost-leadership strategy: • Method to reduce cost and produce least expensive products. • Reduce cost (Cut down advertisement, drop shipping method) • Helped Zappos to gain market share ii. Differentiation strategy • Create unique value through customer service. • 24hrs customer service Customer Quality Service Repeat Business
  6. 6. Ans 2(b) Zappos functional Level • Invest in hiring best employees and make them happy. • Build strong supply chain of product. • Maintain genuine customer relationship.
  7. 7. Ans 3 (a) Toyota: Lean Production Technique • Reduce waste: Extra-processing, defects, over production and improve profitability. • Work on providing consistent quality which will improve the customer satisfaction. • Produce product according to customer demand.
  8. 8. Ans 3 (b) Lean Production in Virginia Mason Hospital Use of Lean Method Activity Outcome Remove unnecessary workflow activities Doctor referral to specialist and patient’s first consultation with the specialist. The job was done directly by doctor by message instead of secretaries. Delays in referral-to- treatment dropped by 68% resulted in improved patient satisfaction. Cut out extra processing Mapping out processing time in Radiation oncology department Rapid treatment process. Patient time in department dropped to 15 from 45 minute Cut out excess employee Secretaries job to refer doctor/consultant was done by doctor through message. Increase in revenue Reason: Profit low, medical errors, patience satisfaction low.
  9. 9. Ans 4(a) Solver “what if” Analysis
  10. 10. 4(b) Overall Equipment Effectiveness OEE Analysis • Very good quality and performance • XYZ Ltd need to work on increasing availability of their equipment
  11. 11. Conclusion • Holacracy is continuous process and should be implemented gradually not radically. • Virginia Manson Hospital was transformed by using lean production method. • Solver “what-if” analysis have limitation.
  12. 12. References Zappos. (2019). Retrieved from Zappos: Harris, L. (2007). Rcbi. Retrieved March 09, 2019, from Rcbi: /spring-2007/features/336-lean-manufacturing-made-toyota-the-success-story- it-is-todayinvesting-in-our-economy Holacracy. (2019). Retrieved 03 10, 2019, from Holacrary: Microsoft. (2019). Retrieved from Microsoft: /en-us/article/define-and-solve-a-problem-by-using-solver -5d1a388f-079d-43ac-a7eb-f63e45925040 Toyota Company. (2019). Retrieved from Toyota Company: toyota_production_system/ Virginia Mason. (2019). Retrieved from Virginia Mason: Pablo, J. (2015, June 03). Harvard Business Review. Retrieved March 9, 2019, from Harvard Business Review: connection-between-structure-and-strategy Smith, P. (2017, September 14). Sinkamanagement. Retrieved March 13, 2019, from Sinkamanagement: virginia-mason/
  13. 13. धन्यवाद…