How Does Shop-Floor Lean Compare to Lean Product and Process Development (LPPD)? A Q&A with Matt Zayko

I have 15 years of lean experience on the shop floor. Recently my organization’s product development leader was let go and the very next day they told me I would be taking over for him. I’ve never experienced the work that goes on in that department, so all I have to go on is my lean experience. Is my knowledge of shop-floor lean enough for me to get by in product development?

Absolutely. The approaches are different, but the concepts are the same.

The first step in grasping the situation for a customer is to define the purpose for a product that you provide for them. This will also help determine the actual “unit” that you’re going to use later to track your value stream effectiveness. In both approaches, that usually comes from identifying the value from the customer’s perspective. In traditional lean we will look at all the steps involved in creating and delivering a specific product, from raw materials to shipping. In LPPD it’s a little trickier at first, because there are steps that we as engineers know will create useful knowledge for value, but the customer (or other internal functions/areas) may not understand. For example, consider doing multiple learning cycles early on to determine the best parameters and process for developing the specific product; the learning cycles could be viewed as waste or re-work if we are not careful to understand the output value of the process. But what it all boils down to for both approaches is identifying the value from the customer’s perspective, whatever it may be, and designing a value stream that best delivers that value.

The next concept is, “What is the actual work to provide that value?” That’s where you look at the value stream. The value stream in product development is very different, but follows a similar pattern as for manufacturing. The difference for LPPD is that you may have to account for numerous functions spread across multiple locations and time zones, a timeframe of a year or more, knowledge flow, experiments, etc. In LPPD, there are typically two high level phases within the value stream: learning and execution. The learning phase is about generating useful knowledge as you converge to an optimal design concept, and may have multiple learning cycles. The execution phase is about configuring and detailed engineering. An LPPD value stream map will be much more detailed than a manufacturing map, since the timeframe for the latter might have a range in days or weeks instead of years. The framework for value stream mapping in LPPD that Jim Morgan pioneered in early 2000s, is very close to what we use for mapping in manufacturing, and that is what Jim based his method on for LPPD mapping from the 1998 LEI workbook, Learning to See.

Once you actually understand the work, the next question is how do you make that work flow? That’s rather straightforward in shop-floor lean. We shrink batch sizes. We get rid of inventory. We reduce process times. We get rid of any distractions or interruptions to the value-add flow. We add standard work for stability. In LPPD, we do similar activities, but to the flow of knowledge and information. We do staggered release of information. We focus on moving the information faster between process steps with minimal delay. We avoid handoffs, where possible. We aim for repeatable routines at process steps at a standard cadence.

Once you’ve identified how to get the work flowing, you need to figure out how the work should be done for maximum quality and efficiency. An important concept in this step is standard work, which again is very straightforward in factory lean. In LPPD it’s another story, because experiments and tasks are traditionally done at the engineer’s discretion. It’s tough to hand an engineer standard work and say, “This is the known best way to make this prototype” when the given prototype has never been conceived. But the underlying questions in establishing standard work are the same for both factory lean and LPPD: What’s the sequence of work? What are the critical quality points? What are the important safety points?

The last question is really, what’s the best management system to improve and manage the work? Between factory lean and LPPD the available tools and techniques are similar, but the timelines will be different. You might have a visual tracking board to record data on a cycle-to-cycle or hour-by-hour basis in the factory; in LPPD that same visual management board might record data on a daily, weekly, or monthly basis to reflect longer cycle times of work tasks. A dedicated obeya or “big-room” space is recommended for a LPPD team as a critical enabler for a cross-functional team to visually manage their process in order to highlight normal from abnormal.

So in conclusion, it is a logical progression for a person who has deep experience in lean transformation on the factory floor to move upstream in the LPPD space using concepts and thinking that were honed on the production floor. This person will have a higher chance of success if he or she is able to have a flexible approach for applying the concepts, as well as an appetite for learning in a very challenging (yet highly rewarding) LPPD environment.

Innovative Companies Continue to Learn from Each Other: Fall 2016 LPPD Learning Group Event

What do a sub-sea oil and gas firm, a household-name appliance maker, a premium sound company, and an iconic industrial and contemporary furniture design organization have in common? With a combined 386 years of existence, FMC Technologies, GE Appliances, Bose, and Herman Miller all have a mutual desire to learn and improve for long-term survival and success. And one shared area of interest for these leading companies is improving the value that they provide each customer starting with new product and process development.

LEI’s Lean Product & Process Development (LPPD) initiative was formed to bring together forward thinking organizations like FMC Technologies, GE Appliances, Bose, and Herman Miller to accelerate the spread of lean thinking and practice in product and process development across very diverse industries. These organizations engage in the LPPD Learning Group partnership with the purpose of transforming their product development systems by changing the way new value is created. And a valuable aspect of the Learning Group is the ability for each of the organizations to come together and meet two times per year with one of the companies acting as host.

Recently, the Learning Group convened their Fall 2016 experience at FMC Technologies in Davis, CA for one and half days in mid-November. Twenty-four people from the four companies actively participated in the session.

Andy Houk, Vice President of New Product Development for FMC’s Schilling Robotics Division, welcomed the learning group to Davis, the headquarters for the division. The Schilling Robotics team designs and manufactures world-class remotely operated vehicles (ROVs) and manipulators for some of the most isolated locations on Earth, serving the critical energy sector for deep-water productivity.

After introductions, LEI LPPD Senior Advisor Jim Morgan stated that this was the fourth LPPD Learning Group event. The group is diverse but has common challenges, and learns from sharing and discussing the failures and successes in an open and safe environment. The theme for this learning event was “people.” As Jim stated, “processes don’t develop great products, people do.”


Jim introduced the agenda with the following conceptual and experiential activities that were planned for this learning group meeting:

  • LEI’s Lean Transformation Framework (LTF) in LPPD with John Shook
  • The Leader’s Role as a Coach and the Chief Engineer with John Shook
  • Gemba visits to FMC’s Rapid Prototyping Area, Valve Subassembly, and Testing Area for Gemini
  • The Concept Paper and its role in LPPD with Jose Ferro
  • Concept Paper examples from FMC Rio and FMC Schilling
  • Obeya Concept for LPPD with Jim Morgan
  • Gemba visit to FMC Daily Product Huddle Obeya Area
  • Obeya learning discussions from Bose, Herman Miller, and GE Appliances
  • Obeya examples for New Product Issues Management and Strategic Planning
  • A3 Thinking and Management with Eric Ethington
  • Gemba visits to Multiple Product Development Obeya Areas at FMC Schilling
  • The Importance of Leadership Mindset & Basic Thinking with John Shook

Below are highlights from select portions of the learning session.

Learning Topic: LTF & Leader’s Role for People Development from John Shook

John Shook, LEI’s CEO, led the discussion of the LEI Lean Transformation Framework (LTF) in LPPD and the leader’s role as a coach. The Lean Transformation Framework was developed based on his 35 years of direct experience working in this area.


The leader’s role in the LTF is to develop people. And the best way to develop a person is while actually doing the work. John stated that the Toyota Chief Engineer system was leading without power, but by skills of true leadership.

Go & See: FMC Gemba Areas, Round 1

In the rapid prototype area (RPA), teams were able to see three levels of prototypes that FMC Schilling Robotics used for fast learning on Manipulator Arm design.


Learning Topic: Concept Paper Sharing by FMC Brazil & FMC Davis

Jose Ferro of LEI Brazil and Fernando Rodrigues of FMC Rio led this discussion of an important LPPD tool used by the Chief Engineer—the Concept Paper (CP).


Jim Morgan reminded the team that “lots of conflict goes in to making a great product,” and the CP can help to focus the challenges and discussions for development teams. Fernando Rodrigues shared his learning with writing a Concept Paper and using it as a “game-changer” for the new Connector Program at FMC Rio. John Drogosz (LEI LPPD Coach) facilitated a concept paper reflection.

Learning Topic: Obeya Concept with Jim Morgan & Organizational Sharing

Jim stressed that obeya was about driving better collaboration and communication by bringing people together with use of this tool to support visual management. The entire learning group took a gemba visit to the Gemini testing obeya site to experience the daily performance-to-plan review in that area.


Learning Topic: A3 Thinking and Management

On day two, the group started with a business case and exercise related to A3 Thinking and Management from Eric Ethington, LEI LPPD Program Manager. Each participant had been asked to bring his or her own A3 to the session. In pairs, the participants practiced both sharing and coaching A3’s. This reinforced key learnings of the A3 as a process to develop people, on the job, while effectively engaging others to solve problems.


Go & See: FMC Gemba Areas, Round 3

The participants had a great opportunity for three more obeya visits for Gemini product development in these FMC areas: Gemini Obeya, “Spinal Cord” Hardware/Software test bed, and the Software Simulator. 

Learning Topic: Leadership Thinking & Mindset with John Shook

John focused on basic thinking of leaders. The power of the Toyota Production System is that it forces people to see problems quickly and solve them immediately. This basic, underlying thinking that is clearly understood and is critical for consistent values and actions throughout an organization.

In closing, Jim Morgan encouraged the group to continue to reach out to each other individually across companies to share more specific learning.

The next Learning Group meeting is tentatively scheduled for the spring of 2017. For more information on joining the LPPD Learning Group, contact Eric Ethington, LPPD Project Manager and Senior Coach at

You Can’t Manage a Secret

Takeshi Uchiyamada had a problem. He had just been named Chief Engineer for arguably the most revolutionary product in Toyota’s history. The goal for this program, initially identified as G21, was to achieve nothing less than 1.5 times the fuel economy of Toyota’s best small cars and develop it on an extremely compressed timeline. To make matters worse, Mr. Uchiyamada lacked the technical depth required to develop and commercialize the advanced hybrid technology that would be required. In fact, no single person at Toyota did. He quickly realized that he would need an unprecedented level of collaboration, transparency and speed of decision making to make this program a success.

Consequently his first pathbreaking innovation had nothing to do with engine technology. Recognizing that his job would be to effectively integrate the efforts of diverse experts and keep the project on track to achieve no compromise targets for performance cost and schedule, he created the “obeya management system.” In this system he met every two to three days with all required technical experts in a room in which all pertinent information was posted on the walls. This information was available to everyone on the team at any time. The G21, which the world has come to know as the Prius, went on to revolutionize the auto industry, dramatically raising the bar for fuel economy and leaving competitors years behind. And the obeya system, credited with making a major contribution to the Prius success, became a development staple at Toyota.

I first heard this story nearly 18 years ago while meeting with Mr. Uchiyamada during my research at the University of Michigan. At the time he was working with a team of Toyota engineers who were tasked with standardizing and teaching obeya throughout the Toyota development community. Obeya, of course, is a Japanese word for big room referring to the large open room required to house the functional technical experts required on the Prius program. Obeya, of course, is a Japanese word for big room referring to the large open room required to house the functional technical experts required on the Prius program.

The challenge to the Toyota team was to capture this powerful system for collaboration and transparency without the ability to co-locate all program teams.

They described the system basics as:

1) Engineers are not co-located. The Functional Engineering Staff Leaders meet with the CE on a varying cadence.

2) Paper-based visual management is the key to effective communication. The walls are plastered with important program information including information on design alternatives, test results, status to attribute performance targets, cost status, status to schedule, and supplier readiness levels. The team walks the walls at regular meetings and sub-teams meet there often between meetings.

3) The obeya location moves with the program. Starting in Engineering, moving to prototype and finally to the plant for launch, the cadence of meetings also change as the program progresses. Typically increasing in frequency to daily meetings as the program moves to launch. For a fuller treatment of both the Prius program and obeya history you can reference the Toyota Product Development System.

During my visits to Toyota City earlier this year I saw that obeya at Toyota has continued to evolve through careful PDCA. There were innovations such as adding CAD and simulation capability in order to facilitate real-time design discussions. But the heart of the system remains visual management and the intent to improve communication, transparency and cross-functional integration in order to quickly identify and solve problems.

Transparency and collaboration were also the essence of Alan Mulally’s message at Ford when he said, “You can’t manage a secret” (and I would add, “…and you can’t solve a problem you’re not aware of.”) He challenged us to increase honest, fact-based communication and improve cross-functional collaboration across the enterprise. One of the ways our team responded was with an “obeya system.” Obeya was not only used to manage program performance, but also to integrate cross-functional teams, as well as to help manage the global functional engineering business, in the creation of the global product development system (GPDS).

I was reminded of these experiences when our LPPD Learning Partner companies came together to learn and share their outstanding work in Davis, California last month. While experience levels and specific practices varied across companies, each company was experimenting with obeya and all reported performance improvement. Several teams reported “best ever” results. In our subsequent discussions we learned many nuances of how they were each leveraging the power of obeya. However, all of them found that the real benefits of obeya were in transparency, speed of problem resolution and team engagement.

So the next time you are tempted to get drawn into circular arguments about what metrics or graphs to share, where they should be placed in the room, or even if obeya should be spelled with one O or two (yes, I have actually heard that). Think about Takeshi Uchiyamada, Alan Mulally, our learning partner companies and the real purpose and power of obeya. Consider: how can you best leverage obeya to better engage your entire team and dramatically improve your performance?



Join us at the 2017 Lean Transformation Summit in Carlsbad, California! Eric Ethington and I will be sharing a variety of LPPD experiences as well as details on how the learning partnership works to accelerate your progress at a pre-conference Open House. Also, FMC Technologies, one of our learning partners, will sharing their experiences with LPPD in a breakout session.

We had a fabulous day at the University of Michigan Hospitals last week. Together we identified many opportunities to apply LPPD to improve patient-centered care and deliver ever-better value. This promises to be an exciting frontier for LPPD.

It was great to see the teamwork developing across our partner companies at our most recent learning event. Each company was sharing openly and supporting the progress of the others. Topics included our Chief Engineer concept paper, enterprise transformation, obeya and A3 for developing people. Our LPPD learning partner model continues to evolve and become more powerful. LPPD senior coach Matt Zayko will be writing up and sharing the event more fully on our site