The Gold Mine: a Novel of Lean Turnaround

Summary

The Gold Mine: a Novel of Lean Turnaround deftly weaves together the technical and human pieces of implementing lean manufacturing in an engaging story that readers will find both compelling and instructive. Authors Freddy and Michael Ballé have produced the first integrated and systematic approach to a set of ideas that have maximized value and minimized waste throughout the world.

At the heart of the Gold Mine is Bob Woods, a curmudgeonly sensei coaxed out of retirement by his son Mike to help boyhood friend Phil Jenkinson save his struggling company. Despite terrific products and a backlog of orders, Phil’s company cannot generate enough cash from its operations to pay its bills. And so Mike enlists Bob to help his pal fix this crisis.

“You’re trying to deal with your mess as if it was a technical problem,” Bob tells Phil. “Move this machine here, change this design there, which it is to some extent, but … it’s all about people. You have a leadership problem not just a production or business problem.” As Phil begins to tackle the key challenges necessary to improve his company’s operations, he comes to understand the deeper points of lean. Readers will also draw powerful insights from his journey.

The Gold Mine presents all the key lean principles, ranging from well-known ideas such as pull and flow, to lesser-known yet equally important principles such as jidoka and heijunka. The book also reveals lean as a system—using a realistic story to show how the principles are interrelated and how they lead to useful tools such as kanban or 5S.

“The Gold Mine is the first book to comprehensively introduce all the lean tools by means of a vivid personal story showing how hearts and minds are won over, said publisher James Womack, LEI president and founder. "It will spark ah-ha’s from everyone who has been there and provide profound insight for those who are just getting started.”

“Reading The Gold Mine is like eavesdropping on a sensei dispensing gems to a client,” says co-publisher Daniel Jones, founder of the Lean Academy in the UK. “Readers, especially those individuals working on the shop floor, will gain revelation and inspiration by living through the experiences of the hero. Managers and executives just beginning a lean transformation will learn valuable insights about how to sidestep the technical and people problems that lay ahead. And experienced lean thinkers will discover fresh insights about overcoming resistance to change.”

While The Gold Mine represents LEI’s first book of fiction, Womack envisions it as a natural complement to the workbooks that have established themselves as the leading guides for learning lean. “The Gold Mine was created on the premise that people have different learning styles, and that a set of ideas based on the shop floor—where the action takes place—can be grasped intuitively by illustrating how one particular company responds,” he says. “It complements our established products by presenting a different but equally vital method of sharing knowledge.”  

About the Authors

Freddy Ballé worked as a manufacturing and engineering manager at Renault for 30 years where he was manufacturing engineering director and then Industrial Vice President for the Renault truck business, Renault Industrial Vehicles (RVI). He started visiting Toyota plants in Japan in the mid-1970s, where he discovered the power of the Toyota Production System.

On leaving Renault, Freddy became technical vice president of Valeo, where he created the Valeo Production System, based on Toyota practice, which pioneered lean implementation in continental Europe. He was then CEO of the French automotive supplier Sommer-Allibert, where he introduced the Sommer-Allibert Excellence System. He wound up his corporate career as technical vice president of the French automotive supplier Faurecia as it implemented the Faurecia Excellence System.

In recent years Freddy has founded ESG Consultants (www.esgconsultants.com)  to advise industrial clients on making the lean transformation described in The Gold Mine.

Michael Ballé, business consultant and author, is associate professor (adjunct) at the American University of Paris and the co-founder of the Project Lean Entreprise (www.lean.enst.fr). This is France’s leading lean initiative, conducted in collaboration with Telecom Paris, where Michael is associate researcher. For over a decade, he has focused on the human implications of lean implementation in fields as diverse as healthcare and administrative processes. He has published several books on these topics. He is Freddy’s son.

Who Benefits

Organizations at any level of a lean transformation, particularly (though not exclusively) those just beginning will benefit from The Gold Mine. Managers, executives, operators, engineers, supervisors, technical support personnel, and change agents just beginning a lean transformation will get valuable insights about how to sidestep the technical and people problems that lay ahead. Experienced lean thinkers will get new insights into overcoming resistance to change.

A Lean Lexicon for The Gold Mine

Adapted from the Lean Lexicon: an illustrated glossary for Lean Thinkers, 2nd edition

Continuous Flow
Producing and moving one item at a time (or a small and consistent batch of items) through a series of processing steps as continuously as possible, with each step making just what is requested by the next step.

Cycle Time
How often a part or product is completed by a process, as timed by observation. This time includes operating time plus the time required to prepare, load, and unload. Also, the time it takes an operator to go through all work elements before repeating them.

Five S
Five related terms, beginning with an S sound, describing workplace practices conducive to visual control and lean production. The five terms in Japanese are:
1. Seiri: Separate needed from unneeded items-tools, parts, materials, paperwork-and discard the unneeded.
2. Seiton: Neatly arrange what is left-a place for everything and everything in its place.
3. Seiso: Clean and wash.
4. Seiketsu: Cleanliness resulting from regular performance of the first three Ss.
5. Shitsuke: Discipline, to perform the first four Ss.

Five Whys
The practice of asking why repeatedly whenever a problem is encountered in order to get beyond the obvious symptoms to discover the root cause.

Heijunka
Leveling the type and quantity of production over a fixed period of time. This enables production to efficiently meet customer demands while avoiding batching and results in minimum inventories, capital costs, manpower, and production lead time through the whole value stream. Roughly, it means “levelization” in Japanese.

Inventory
Materials (and information) present along a value stream between processing steps.

Inventory Turns
A measure of how quickly materials are moving through a facility or through an entire value stream, calculated by dividing some measure of cost of goods by the amount of inventory on hand.

Jidoka
Providing machines and operators the ability to detect when an abnormal condition has occurred and immediately stop work. This enables operations to build in quality at each process and to separate men and machines for more efficient work. Jidoka is one of the two pillars of the Toyota Production System along with just-in-time. It's related to the Japanese word for automation, but with the connotations of humanistic and creating value.

Kaizen
Continuous improvement of an entire value stream or an individual process to create more value with less waste. The word is Japanese for gradual, continuous improvement. There are two levels of kaizen:
1. System or flow kaizen focusing on the overall value stream. This is kaizen for management.
2. Process kaizen focusing on individual processes. This is kaizen for work teams and team leaders.

Kanban
A kanban is a signaling device that gives authorization and instructions for the production or withdrawal (conveyance) of items in a pull system. The term is Japanese for “sign” or “signboard.” Kanban cards are the best-known and most common example of these signals.

Muda, Mura, Muri
Three Japanese terms often used together in the Toyota Production System (and called the Three Ms) that collectively describe wasteful practices to be eliminated.

• Muda: Any activity that consumes resources without creating value for the customer.
• Mura: Unevenness in an operation; for example, an uneven work pace in an operation causing operators to hurry and then wait.
• Muri: Overburdening equipment or operators.

Pull Production
A method of production control in which downstream activities signal their needs to upstream activities. Pull production strives to eliminate overproduction and is one of the three major components of a complete just-in-time production system, along with takt time and continuous flow.

Sensei
The Japanese term for “teacher.” Used by Lean Thinkers to denote a master of lean knowledge as a result of years of experience.

Seven Wastes
The categorization of the seven major wastes typically found in mass production:
1. Overproduction: Producing ahead of what's actually needed by the next process or customer. The worst form of waste because it contributes to the other six.
2. Waiting: Operators standing idle as machines cycle, equipment fails, needed parts fail to arrive, etc.
3. Conveyance: Moving parts and products unnecessarily, such as from a processing step to a warehouse to a subsequent processing step when the second step instead could be located immediately adjacent to the first step.
4. Processing: Performing unnecessary or incorrect processing, typically from poor tool or product design.
5. Inventory: Having more than the minimum stocks necessary for a precisely controlled pull system.
6. Motion: Operators making movements that are straining or unnecessary, such as looking for parts, tools, documents, etc.
7. Correction: Inspection, rework, and scrap.

Standardized Work
Establishing precise procedures for each operator's work in a production process, based on three elements:
1. Takt time, which is the rate at which products must be made in a process to meet customer demand.
2. The precise work sequence in which an operator performs tasks within takt time.
3. The standard inventory, including units in machines, required to keep the process operating smoothly.

Takt time
The available production time divided by customer demand. For example, if a widget factory operates 480 minutes per day and customers demand 240 widgets per day, takt time is two minutes. Takt is German for a precise interval of time.

Total Productive Maintenance
A set of techniques, originally pioneered by Denso in the Toyota Group in Japan, to ensure that every machine in a production process always is able to perform its required tasks.

Value Stream Mapping
A simple diagram of every step involved in the material and information flows needed to bring a product from order to delivery. The first step is to draw a visual representation of every step in a process, including key data, such as the customer demand rate, quality, and machine reliability. Next, draw an improved future-state map showing how the product or service could flow if the steps that add no value were eliminated. Finally, create and implement a plan for achieving the future state.

Waste
Any activity that consumes resources but creates no value for the customer.