To fully understand what we mean by a Lean Enterprise, we should first define what “lean” means in a business context: "a complex and adaptive system composed of people who share a common purpose". The essential common denominator on which the success of any lean business is founded, must be a single, unified purpose, known and shared by all the company employees. It is neither the vision, which describes what an organisation aspires to become, nor the mission, which describes what it does. Creating, maintaining, and communicating the company's purpose is the responsibility of the company's leaders. It has long been thought that the primary job of executives should be to focus on maximising shareholder value, and this goal has been reinforced by compensating executives with stock. However, studies have demonstrated in no uncertain terms that this method does not work: organisations that are successful in the long term are those capable of developing their ability to innovate and direct their focus towards the employees, customers and products.
Not many people know the history of NUMMI (New United Motor Manufacturing, Inc.) a car factory opened in 1984 in a joint venture between General Motors and Toyota. However, this experiment is very well known to those interested in corporate processes and culture, in particular those derived from the Toyota Production System. To create NUMMI, GM chose the Fremont Assembly plant, which had been shut down in 1982 because it was one of the worst of the group, both in terms of the quality of the cars produced, and the relationship between managers and workers. The key to the Toyota Production System, as it was applied to NUMMI, was “teamwork”.
Since the key to the success of this project was teamwork, it was necessary to create a culture of collaboration and re-establish healthy relationships between management and workers, which was essential to uphold the absolute priority in the Toyota Production System: maintaining the highest quality. A problem must be solved as soon as possible, and, each time a problem occurs, the system must be improved to prevent that same problem from repeating itself. Workers and managers work together to make this "quality race" possible: the moment a worker discovers a problem, they can summon the manager by activating what is called the Andon process (it was originally done by pulling a cord, then replaced by a warning light system). The manager who is called to the production line - which is put on pause until he or she arrives – helps find the solution. This is a big change from a traditional company hierarchy: in a lean system, the main task of managers is to join forces with the factory workers, who have the power to stop production, and are directly involved in the decision-making process to improve the entire system. Another way in which the Toyota Production System (or TPS as we will refer to it) underlines this climate of teamwork is by removing any symbols and privileges: in the NUMMI plant, no one wore a tie, and there was no separate canteen or parking spaces for managers and workers, which helped emphasise the fact that everyone is part of the same team.
This paradigm shift was a real revolution for NUMMI employees, and triggered a virtuous spiral of involvement and active participation that allowed the plant to establish itself as one of the most productive in the GM group. Much of the success of TPS lies in its effects on workers. Taylorism was one of the earliest attempts to apply science to the engineering of processes, and characterised people as cogs in a machine, who were paid to carry out planned actions as quickly as possible. TPS, on the other hand, makes workers an active part of a continuous improvement process, motivates them with a higher purpose, that purpose being quality, value and customer service, giving them a great level of autonomy to experiment through their ideas.