Practices Without Principles, TPS Without the Toyota Way

I’ve been reading about “lean” as it relates to the roots of Agile software development, specifically the creation and evolution of “lean thinking” at Toyota as described in The Toyota Way by Jeffrey Liker.  The book emphasizes an important dichotomy:

  1. the practices and techniques used by Toyota termed the “Toyota Production System” or TPS (just-in-time, kanban, one-piece flow, etc.) as distinct from:
  2. the principles and philosophy that permeate the organization he calls the “Toyota Way”.

Liker sets out a resounding case for why lean is at best mildly effective when the implemented practices are not accompanied by the fundamental underlying principles and philosophy of lean thinking that is so engrained in the Toyota culture.  One example he cites is particularly disturbing (paraphrased, pp. 11-12):

The Toyota Supplier Support Center (TSSC) was set up by Toyota in the U.S. to help U.S. companies learn TPS and lean.  Over the years they worked with many U.S. companies in diverse industries, in each case doing a “lean project” by transforming one production line in a company using TPS tools and methods.  Typically companies apply for TSSC’s assistance, but in 1996 TSSC made an unusual request; TSSC approached an industrial sensor company (“Lean Company X”) widely regarded as a best-practice example of lean manufacturing in the U.S.  In fact, Lean Company X was a common tour site visited by other companies aspiring to be just as lean.  Lean Company X even won a prestigious lean manufacturing award.

Nevertheless, Lean Company X accepted TSSC’s offer and began a nine-month improvement effort on one of Lean Company X’s production lines.  At the end of the nine-month project, this previously “world class” production line was drastically altered.  It had obtained a state of leanness X could not have thought possible and the production line leap-frogged the rest of X’s plant on all key performance measures, including:

  • 46% reduction in lead-time to product product
  • 83% reduction in work-in-process inventory
  • 91% reduction in finished-goods inventory
  • 50% reduction in overtime
  • 83% improvement in productivity

What’s alarming here is that these numbers do not represent small-incremental change.  This is radical improvement in a leading U.S. lean site!

Liker writes: “The problem, I believe, is that U.S. companies have embraced lean tools but do not understand what makes them work together in  a system.  Typically management adopts a few of the technical tools …  But they do not understand the power behind true TPS: the continuous improvement culture needed to sustain the principles of the Toyota Way.

Reading this, I can’t help but feel as though this example foreshadows the future of the Agile movement.  Too many organizations are dabbling in Agile and selecting practices that suit their needs without understanding and embracing the principles behind Agile and permeating real cultural change.  Honestly, there was a time when I thought philosophies and principles were marketing gibberish, but experience has taught me otherwise.  Stories like these in The Toyota Way teach me otherwise.  Considering the sorry state of affairs in the U.S. auto industry, I hope we can learn from history and recognize that, like lean, Agile software development is about a fundamental cultural change toward continuous improvement and a corporate culture that puts the welfare of customers, employees, and the general public above all else.

Victor Szalvay

Victor Szalvay currently leads product development for CollabNet’s ScrumWorks® product suite. In that capacity, he works closely with customers, stakeholders, and the development teams to deliver high business value each release cycle. With more than 150,000 active users worldwide, ScrumWorks is used by more than half of the Fortune 100 and boasts the largest market share of any Agile management tool.

Posted in Agile
2 comments on “Practices Without Principles, TPS Without the Toyota Way
  1. Vikas Kerni says:

    Exactly my thoughts.
    I had lot of reservations about Agile Methodology. TSP really helped me to look Agile Methodology from a new persecptive.

  2. JR says:

    Hi Victor,

    Great summary. I am just making my way through the Toyota way also and really enjoyed this story.

    It showed how far anyone has to go before they come close to the level of application Toyota has with TPS. I would also stipulate that copying Toyota should not be the goal per se (I don’t think that is possible). Each will need to find there own way (and Toyota has much to offer here).

    Regarding agile. Yes I agree it will undoubtedly share stories similar to that of Toyota and lean. But I think it is good none the less (when you consider the the alternative).

    Those companies that embrace the principles and values will succeed (some will fail). Those that don’t may also succeed (I and others like yourself may choose just not to work there).

    Great post. Thanks for sharing.

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