Lean Thinking: Banish Waste and Create Wealth in Your Corporation, Revised and Updated

402 Pages·2003·14.07 MB·english

by  James P. Womack

B ANISH WASTE
AND CREATE WEALTH IN
YOUR CORPORATION
T.Jones
Authors of The Machine That Changed the World
James P. Womack and Daniel T. Jones's classic book Lean Thinking has sold in the hundreds of
thousands in a dozen countries. Today, nearly seven years after the publication of the first edition—
and given ample evidence that businesspeople are finding the book increasingly relevant—it is
clearer than ever that lean thinking is the single most powerful tool available for creating value
while eliminating waste, in any organization. As economies have gyrated, stock markets have
crashed, and the poster companies of the 1990s have flown a ballistic trajectory, the lean exemplars
profiled in the book—led by Toyota—have continued their methodical march from success to suc-
cess by creating truly sustainable value for their customers, their employees, and their owners. In
this revised and updated edition, on top of offering the wealth of practical material from the first
edition, Womack and Jones now bring the story of the continuing advance of lean thinking up-to-
date, and also share a range of new tools aimed at the successful application of lean thinking.
Raves for The Machine That Changed the World by James P. Womack and Daniel T. Jones
"The Machine That Changed the World is a very important book. I am impressed."
—Peter F. Drucker, author of The Post-Capitalist Society
"The best current book on the changes reshaping manufacturing, and the most readable, too... con-
veys a very human sense of managers constrained by limited resources yet trying to do better."
—Business Week
"A revealing and compellingly readable account of Japan's achievement in revolutionizing manu-
facturing An eye-opener even for those who already knew Japan didn't do it all with robots."
—Financial Times (Business Book of the Year)
"This is a book of great understanding, and of hope. It shows how to create an industrial world in
which workers share the challenges and satisfactions of the business. It's a world in which assem-
blers communicate with suppliers and dealers in a way that improves life for all of them. Read it."
—Automotive News
"Truly remarkable. . . . The most comprehensive, instructive, mind-stretching and provocative
analysis of any major industry I have ever known. Why pay others huge consulting fees? Just read
this book." —Philip Caldwell, Chairman and CEO, Ford Motor Company, 1980-1985
U.S. $30.00
Can. $41.00
Expanded, updated, and more relevant than ever,
this bestselling business classic by two internationally
renowned management analysts describes a business sys-
tem for the twenty-first century that supersedes the mass
production system of Ford, the financial control system of
Sloan, and the strategic system of Welch and GE. It is
based on the Toyota (lean) model, which combines opera-
tional excellence with value-based strategies to produce
steady growth through a wide range of economic conditions.
In contrast with the crash-and-burn performance of
companies trumpeted by business gurus in the 1990s, the
firms profiled in Lean Thinking—from tiny Lantech to
midsized Wiremold to niche producer Porsche to gigantic
Pratt & Whitney—have kept on keeping on, largely unno-
ticed, along a steady upward path through the market
turbulence and crushed dreams of the early twenty-first
century. Meanwhile, the leader in lean thinking—Toy-
ota—has set its sights on leadership of the global motor
vehicle industry in this decade.
Instead of constantly reinventing business models, lean
thinkers go back to basics by asking what the customer
really perceives as value. (It's often not at all what existing
organizations and assets would suggest.) The next step is
to line up value-creating activities for a specific product
along a value stream while ehminating activities (usually
the majority) that don't add value. Then the lean thinker
creates a flow condition in which the design and the prod-
uct advance smoothly and rapidly at the pull of the
customer (rather than the push of the producer). Finally, as
flow and pull are implemented, the lean thinker speeds up
the cycle of improvement in pursuit of perfection. The first
part of this book describes each of these concepts and
makes them come alive with striking examples.
Lean Thinking clearly demonstrates that these simple
ideas can breathe new life into any company in any indus-
try in any country. But most managers need guidance on
how to make the lean leap in their firm. Part II provides a
step-by-step action plan, based on in-depth studies of more
than fifty lean companies in a wide range of industries
across the world.
(continued on back flap)
(continued from front flap)
Even those readers who believe they have embraced
lean thinking will discover in Part ID that another dramatic
leap is possible by creating an extended lean enterprise for
each of their product families that tightly links value-
creating activities from raw materials to customer.
In Part IV, an epilogue to the original edition, the story
of lean thinking is brought up-to-date with an enhanced
action plan based on the experiences of a range of lean
firms since the original publication of Lean Thinking.
Lean Thinking does not provide a new management
"program" for the one-minute manager. Instead, it offers
a new method of thinking,,,of being, and, above all, of
doing for the serious long-term manager—a method that
is changing the world.
JAMES WOMACK AND DANIEL JONES have
collaborated on analyses of global industrial trends for
more than twenty years. They are coauthors of The
Machine That Changed the World, Seeing the Whole, and
The Future of the Automobile.
Womack is founder and president of the Lean Enter-
prise Institute (www.lean.org), a nonprofit education and
research organization based in Brookline, Massachusetts,
dedicated to the spread of lean thinking.
Jones is founder and chairman of the Lean Enterprise
Academy in the U.K. (www.leanuk.org), a nonprofit orga-
nization affiliated with the Lean Enterprise Institute and
pursuing the same objectives in English-speaking Europe.
Visit us online at www.simonsays.com j
Jacket design by Jack Ribik
Authors' photograph by Bachrach Photographers
Printed in the U.S.A.
Copyright © 2003 Simon & Schuster Inc.
Distributed by Simon & Schuster Inc.
Also by James P. Womack and DanielT. Jones
The Machine That Changed the World
(with Daniel Roos)
The Future of the Automobile
(with Alan Altshuler, Martin Anderson, and Daniel Roos)
Seeing the Whole: Mapping the Extended Value Stream
LEAN
T H I N K I NG
BANISH WASTE AND CREATE WEALTH
IN YOUR CORPORATION
Revised and Updated
James P. Womack
and Daniel T. Jones
FREE PRESS
For Anne
Both necessary and sufficient;
my picture of perfection
J.P.W.
and
for Pat
My patient and wise counselor
D.T.J.
/P
FREE PRESS
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Copyright © 1996,2003 by James Womack and Daniel Jones
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10
Library of Congress Cataloging-in-Publication Data is available.
ISBN 0-7432-4927-5
Preface to the 2003 Edition
Lean Thinking was first published in the fall of 1996, just in time—we
thought—for the recession of 1997 and the financial meltdown of 1998. The
book's mission was to explain how to get beyond the financial games of
the 1990s to create real, lasting value in any business. Toward this end, it
demonstrated how a range of firms in North America, Europe, and Japan
took advantage of the recession of 1991 to rethink their strategies and embark
on a new path.
In our presentations to industrial audiences, we often point out that the
only sure thing about forecasts is that they are wrong. (Which is why lean
thinkers strive to reduce order-to-delivery times to such an extent that most
products can be made to order and always try to add or subtract capacity
in small increments.) Instead of a recession in 1997, the most ebullient econ-
omy of the entire twentieth century charged ahead for five more years, into
2001, extending a remarkable era in which practically anyone could succeed
in business.
Given that the book was published years before our ideas were most
needed, it's surprising how many readers took the advice in Lean Thinking se-
riously during the best of times. More than 300,000 copies have been sold in
English, and it's been translated into German, French, Italian, Portuguese,
Polish, Turkish, Korean, Japanese, and Chinese. We have heard from readers
across the world about their successes in applying its principles.
Once reality caught up with our forecast, and the recession of 2001 gave
way to the financial meltdown of 2002, reader interest surged. Indeed, Lean
Thinking reappeared on the Business Week business-books bestseller list in
2001—nearly five years after its launch and with no publicity campaign—an
unprecedented event, according to our publishers.
Given clear evidence that readers are now finding Lean Thinking even more
relevant in their business lives than when it was first published, we have de-
cided to expand and reissue the book. In Part I we explain some simple, ac-
tionable principles for creating lasting value in any business during any
business conditions. We then show in Part II how to apply these principles,
6 PREFACE TO THE First EDITION
step by step, in real businesses, from large to small. In Part III, we show how a
relentless focus on the value stream for every product—from concept to
launch and order to delivery, and from the upstream headwaters of the supply
base all the way downstream into the arms of the customer—can create a true
lean enterprise that optimizes the value created for the customer while mini-
mizing time, cost, and errors.
In the two new chapters of Part IVJ we bring the story of the continuing ad-
vance of lean thinking up-to-date. We track the trend in inventory turns—the
lean metric that cannot lie—across all industries, singling out one industry for
special praise. We also track the progress of our profiled companies. We dis-
cover that as economies have gyrated, stock markets have crashed, and the
poster companies of the 1990s hailed in other business books have flown a
ballistic trajectory, our lean exemplars—led by Toyota—have defied the fate
of most firms featured in successful business books. They have continued
their methodical march from success to success and have done it the hard way
by creating real and truly sustainable value for their customers, their employ-
ees, and their owners.
Finally, in the concluding chapter, we share what we have ourselves learned
since 1996 about lean thinking and its successful application by describing a
range of new implementation tools. These begin with the concept of value
stream mapping, which we have found to be a remarkable way to raise con-
sciousness about value and its components, leading to action.
In revising the book we have corrected a few minor errors and omissions in
the original text. However, we have been careful not to change the pagina-
tion. We know that many organizations use Lean Thinking as a text to guide
their change process, distributing copies widely and often including their dis-
tributors and suppliers. Thus we wanted to ensure that there will be no diffi-
culty in interchanging the two editions.
Today, nearly seven years after its publication, we are even more certain that
lean thinking, as explained in Lean Thinking, is the single most powerful tool
available for creating value while eliminating waste in any organization. We
hope that previous readers will use this new edition as an opportunity to
renew their commitment to lean principles. And we especially hope that
many new readers will discover a whole new world of opportunity.
Jim Womack and Dan Jones
Brookline, Massachusetts, and Ross-on-Wye, Herefordshire, U.K.
February 2003