Business magazine "Commersant-Den’gi” published an interview if the MAY Chairman of the Board Igor Lisinenko.
“We found the dirtiest processing unit and wash it white”.
Chairman of the Board Igor Lisinenko tells about five steps to lean business culture.
Till August 1998 our business was growing like a rocket: every month we hired hundreds of new employees. And, one day it was clear that this period is over. And that it is necessary not just to wait, and then keep on it – but it is time to change everything radically. You can’t continue spending and growing by hundreds of percent per year. Economy is characterized by the cyclical fluctuations, so the crises will cycle.
The main expenditure item for production is the material resources. Looking for new methods of "lean manufacturing", we addressed to the Japanese experience, namely to Toyota. Its famous “Toyota Production System” was adopted by our company. It includes five main steps. The first step is to clean up. If everything is perfectly clean, you immediately reveal the fact of overconsumption, for example, oil leakage. The second step is to specify the place of each thing. You can even paint the correct standing position on the floor to ensure that everything stands in the right position. This is a "foolproof" mechanism like an intuitive interface by Apple. The third step is to remove the things, which have not been used for last six months. The fourth step is to record all three previous steps: everything must be defined in a certain way, for example, on the desktop there should be nothing except a computer. The fifth step is to check that everything works according to the rules and try to improve the rules if it is necessary.
All this may seem as unnecessary mere formality, but the mass production is a system of lots of people, not understanding each other. It is very difficult to manage this system in an effective way and to avoid surplus or defected goods. However, I am sure that all these principles will work for office staff too.
We launched Toyota system in 1999. One day the entire white-collar top management came to the production facilities. We’ve found the dirtiest processing unit and wash it white without any explanations. It was a clear message that the company was going to change. Just formal announcement about "Kaizen" introduction would not have worked. It was necessary to impact in a different way and to illustrate a strong personal example.
According to "Kaizen", whole staff should be involved in the search for wastes to eliminate them and to save resources. This system outlines 7 types of wastes, or «muda» in Japanese. There are waste of overproduction (largest waste), waste of time on hand (waiting), waste of transportation, waste of processing itself, waste of stock at hand, waste of movement and waste of making defective products. To eliminate wastes you should use the following five steps. The first step is to determine the price of your product and to make sure you didn’t spend on an excessive quality, which can’t be assessed by the end consumer. As an example it concerns too much packaging. The second step is to find out what is really important in your product for the consumer. The third step is to check if there are no obstacles or delays on the path of the product chain in order not to be like a car that revs up, but brakes hard by the obstacles and just loses fuel. The fourth step is to have an optimum quantity of the stocks based on sales and not to keep surplus. The fifth step is, as usual, the continuous improvement of the system.
The introduction of "Kaizen" was finished in 2003. In January 2015, we fulfilled the sales plan by 130%. So, we are ready for the current crisis, and we start to prepare for the next one that will happen, apparently, in 2021.