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Viewing Continuous Improvement Through an Environmental Lens: A Q&A with Toyota’s Ryan McMullan

Toyota Executive portraits-Ryan McMullan

“I’ve noticed in my time at Toyota that the environmental lens is a way of focusing problem solving,” says Ryan McMullan, environmental and safety manager for Toyota. Back in the 1950s, when Toyota put forward the idea of continuous improvement, eliminating various kinds of waste from production became an important step in the process. Now that step includes identifying wasted resources such as water, fuel, and materials. “The approach Toyota took allowed environmental and financial success to go hand in hand,” McMullan says.

He will be speaking about jumpstarting worker engagement around identifying opportunities for improvement as well as the effectiveness of continuous improvement at the 2017 Environmental Leader Conference in June. Recently we caught up with him to learn about the benefits that can emerge from a business that has a culture of improvement.

What does continuous improvement mean at Toyota?

Continuous improvement goes back to the Japanese term kaizen. It’s small incremental changes made permanent — and a lot of them. It started in the ’50s, and Taiichi Ohno was the main architect. Every improvement doesn’t have to be a moonshot. You can have one improvement that will save three pennies per car. If you do enough of those, it adds up. That was the revolutionary approach.

This feeds into the Toyota Production System (TPS), which is the foundation for lean manufacturing. The model before that was the management and industrial engineers would come up with all the improvements, and factory line workers would implement them. What Taiichi Ohno and Eiji Toyoda figured out is you ask the person doing the work how it could be done better and give them the tools to do it better.

The Charlie Chaplin movie where he’s a factory line worker, that was the mentality at the time. If you go to work at a factory, you check out your brain and turn the crank. What they started to realize is they needed the assembly line workers’ brains engaged in improvements. In order for them to be engaged, there needs to be trust, the expectation that if they raise an idea it will be taken seriously, and resources to make it come true. That’s more challenging than having experts sweep in saying, ‘move this here.’

When Toyota opened up their first U.S. plant in the United States, in Kentucky, they invited folks to come see the plant, including Ford and GM, whoever wanted to come. They gave tours in the late ’80s. [Visitors] would take one tool out of this management system and try to implement it without the surrounding interrelated systems. It doesn’t work the same way when there’s no culture of improvement.

Within TPS, there’s a broad definition of waste, the Japanese term muda. In Toyota, when they’re teaching continuous improvement, they teach how to spot waste. Originally there were seven mudas, like overproduction, waiting, transportation, and processing. Later they added the eighth, which is the waste of your workers’ creativity. If you’re not listening to their improvement ideas, you’re wasting that potential.

How does continuous improvement work at Toyota?

For continuous improvement, there are two pieces. One is kaizen, a small incremental change. The second is making that change permanent so it doesn’t backslide. The idea is that you make that improvement, however small, a permanent part of the process. So the next time you come up with an idea, you’re improving upon the already-improved-upon process, not the one from a couple years ago. Both pieces have to be in place before you can turn that crank and come up with hundreds of incremental improvements that add up to a very efficient Camry assembly line, for instance.

A book by Paul Akers called ‘2 Second Lean’ talks about trying to implement the Toyota Production System at his small tool manufactory. His innovation is do an improvement a day that’s going to save you two seconds. It doesn’t have to be grand or save the company hundreds of thousands of dollars. Do something that makes life less annoying every single day.

What is an example of continuous improvement at Toyota related to environmental goals?

About 25% of our cars are still imported. You’ve got a spoiler surrounded by Styrofoam blocks in a cardboard box. At our port facilities, they take that spoiler out of the box, install it on the vehicle, and send it to the dealership. Somebody at the port facility said, ‘We don’t have anywhere to recycle these Styrofoam blocks. We’re throwing them in the trash.’ They reached out to me in the environmental group, and I reached out to the folks who design the packaging. They were worried about the damage rate of the part and how much the packaging costs.

I brought them together. The packaging engineer went to their supplier and asked for options. We came up with a package where they were able to use cohesive craft paper. The paper sticks to itself and doesn’t leave a residue on the spoiler. It was actually cheaper than the Styrofoam. Now all the packaging is recyclable, the initial purchase price of the package is cheaper, and it cut the volume of the box in half. You can fit twice as many on a truck. That’s less diesel, fewer greenhouse gas emissions. You can also fit more on a shelf. All these benefits came with that one change. Per spoiler, the new packaging reduced greenhouse gases by more than one kilogram of carbon dioxide equivalent, and resulted in a net savings of $4.

What advice do you have for leaders looking at using continuous improvement to reach sustainability goals?

Identify how you’re going to make improvements permanent. Second, whenever you’re working on a specific improvement, you want your focus to be on the next 10 improvements. You might need to sacrifice some effectiveness on the current improvement in order to teach that process of improvement.

For example, if you’ve ever cooked with little children, teaching them to cook is going to be faster, more efficient, and much less of a mess if you just do it yourself. But then they’ll never learn. Let them do it the wrong way because over the long term they’re going to learn to do it well. That’s not the most favorable comparison to frontline factory workers — I don’t mean to imply that they’re children. But when somebody is new to a skill, there’s a learning curve. A lot of people’s first impulse is to sideline them. If you do, you’ll never have a culture of improvement. You’ll just have a few experts implementing other people’s ideas.

What happens when there is that failure?

At Toyota, we borrow the Japanese term hansei, which means reflection. Whenever you finish a project, you do the reflection. It’s another habit to get that continuous improvement. Make sure that reflecting on a project happens every time, whether it succeeds or fails.

You have to celebrate smart failure. Paul Akers talks about how, with somebody whose improvement had failed, he would highlight them. ‘I want you to know that Bob had a great idea and took a big risk. It didn’t work out the way he thought it would, but what we learned was this.’ And that learning is so valuable. Now we know.

Ryan McMullan will be speaking at the Environmental Leader Conference in Denver June 5-7, 2017. His track, The Effectiveness of Continuous Improvement, starts at 11:05 am on June 6.

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