The University and the Lean Learning Agenda

1. The University and the Lean Learning Agenda Productivity’s Building Lean Leaders Conference October 15, 2001 Peter Ward Fisher College of Business Ohio State University

2. Discussion Overview • The landscape: Universities and Lean • University as a supply chain partner • Teaching Lean: An example • An agenda for action

3. Little course work of any kind The Landscape Business Engineering Functional Schools Schools Centers Lots of courses. Largely narrow, cell-level view of Lean. Pockets of excellence. Examples: U. Michigan MIT

4. B-Schools and Lean • Lean production is relegated to a narrow technical issue in business school curriculum. • The technical parts of lean production are important but at its core, lean production presents a revolutionary way to MANAGE the value stream.

5. Top Managers Think About Lean Differently Upper level Flow Kaizen Value stream / System level Level of Management Process Kaizen Cell level Lower level Focus

6. Lean Thinking is Largely Absent from B-School • MBA Courses • Doctoral Dissertations • Articles in research journals

7. Consequences • Traditional manufacturing is perceived by students as boring, overly-technical and underpaid. MBAs don’t get to see the bright side! • Professors are similarly uninformed. Productivity gains are attributed to a variety of programs and technologies. • The organizing principles provided by lean thinking is missing.

8. More Consequences-MBA Schools Influence Corporate Leaders • Teaching new managers • Executive education • Consulting by faculty • Writing by faculty

9. Supply Chain View Universities are key links in the knowledge and human resources supply chains. • It only makes sense for businesses to provide help to key suppliers when they need it. • We’ve already established that most universities need plenty of help when it comes to lean!

10. An Example of a Lean MBA Curriculum at Ohio State Grounded in a Supply Chain View:Tomorrow’s Lean Enterprise Leaders(Taken by 50 Full time MBA Students in Spring 2001. This is about 1/3 of the class!)

11. Physical Supply Chain: Auto Industry Example Dealers OEM Tier 1 Suppliers Tier 2 Suppliers Tier 3 Suppliers

12. Knowledge Supply Chain: Auto Industry Example Dealers Organizations (e.g., SME) OEM Consultants & “Think Tanks” Tier 1 Suppliers Tier 2 Suppliers Universities & Colleges Tier 3 Suppliers

13. Tomorrow’s Lean Enterprise Leaders Helping MBAs to develop a passion for manufacturing • Spring: Developing Lean Manufacturing Tools • Summer: Applying Lean Tools • Fall: Integrating Lean Manufacturing with MBA experience

14. Developing Lean Manufacturing Tools • 30 plus classroom hours of material adapted from Ford teaching programs and delivered by top educators fromindustry • Real time value stream mapping experience in supplier plant; student teams led by Ford engineers and plant personnel. • Additional 8 hour “boot camp” instruction is provided by people from key Ford suppliers.

15. Applying Lean Tools • Internship at Ford or Ford Supplier working on projects related to lean manufacturing.

16. Integrating Lean Manufacturing with MBA experience • 20 classroom hours with MBA professors. • Consider how lean thinking should integrate with management and what roadblocks exist. • Develop and present case studies to audience comprising of faculty and executives.

17. Topics covered in Lean Curriculum • Simulation exercise contrasting mass production with lean production. • Lean manufacturing metrics and measurables. • Value stream mapping. • Production system design, implementation issues, and planning. • Hoshin Kanri. • Problem solving. • Poka-Yoke (mistake proofing). • Standardized work. • Quick changeover. • Lean accounting and performance measurement

18. Outcomes • Participating companies • MBA student participants • Scholarly research • Dissemination of lean thinking

19. Internships: Benefits To Employers Outweighed Costs • Achieved potential savings of over $330,000 per year by redeployment 11 shop floor associates • Identified major causes of downtime and assisted in establishing plan to increase productivity for an annual savings of $200K • Set up a Kanban simulation that can potentially reduce finished goods inventory up to 70% • Created action plan to reduce raw materials inventory received from Japan by 84% • Discovered potential $30,000 in daily inventory savings through card-for card and lot box Kanban training and implementation • Led team working on product flow improvements between work areas through value stream mapping activities. • Participated in and led trainings and workshops teaching and implementing lean manufacturing concepts with suppliers.

20. What the MBA Students Said They Knew Before but Really Learned on the Internship • Lean philosophy is applicable to all business processes • The importance of training and employee involvement • Change management skills • Top-down support • Buy-in at implementation level

21. What I Observed That The Students Learned • To appreciate the power of lean thinking • To be passionate about manufacturing • To understand that there is more to managing than pushing the numbers • In addition, each individual learned particular lessons that they needed to learn

22. Scholarly Research • Article submitted to a research journal on implementation of lean production • New Ph.D. Dissertation in lean under way

23. Dissemination of Lean Thinking • Tomorrow’s Lean Enterprise Leaders program expected to double in size between 2000 and 2002 • Executive education programs • Academy of Management presentation by faculty and executives • Faculty workshops at Univ. of Michigan-LEI conference and at Ohio State • Beginning to capture a share of the best and brightest management students for manufacturing

24. Agenda for Action • Business leaders influence through supply chain partnerships • Begin where you hire • Constructive relationships with deans • Speak in university classes and tell your story • Encourage faculty to become involved in training

25. Agenda for Action • Faculty teaching faculty • Summer camps • Thought leaders (like Productivity) must be involved • Research influences faculty interests

26. Benefits • Core of young management talent with a bias toward manufacturing • Common vocabulary linking lean with running the business • Investigation of critical topics, e.g. • Documenting lean programs with improvements in bottom line and strategic position • Applying lean in environments other than discrete part manufacturing

27. Universities can be powerful allies in preparing future leaders and disseminating lean thinking or they can be largely irrelevant. Business leaders must also lead in developing a constructive alliance.