John Shook: The Innovation Interview

John Shook, Chairman and CEO of The Lean Enterprise Institute shares his thoughts and insights on innovation, technology and lean management.

John Shook learned about lean management while working for Toyota for nearly 11 years in Japan and the U.S., helping it transfer production, engineering, and management systems from Japan to NUMMI, the GM-Toyota joint venture, and subsequently to other operations around the world.

While at Toyota’s headquarters, he became the company’s first American kacho (manager) in Japan. In the U.S., Shook joined Toyota’s North American engineering, research and development center in Ann Arbor, MI, as general manager of administration and planning. His last position with Toyota was as senior American manager with the Toyota Supplier Support Center, Lexington, KY, assisting North American companies implement the Toyota Production System.

He is the author of Managing to Learn and co-author of Learning to See and Kaizen Express. His article “How to Change a Culture: Lessons from NUMMI“; Sloan Management Review, January 2010, won Sloan’s Richard Beckhard Memorial Prize for outstanding article in the field of organizational development.

Shook holds a bachelor’s degree from the University of Tennessee, a master’s degree from the University of Hawaii, and is a graduate of the Japan-America Institute of Management Science. He is the former director of the University of Michigan, Japan Technological Management Program, and served on the faculty of the university’s Department of Industrial and Operations Engineering. Shook is a member of the Industry Week Manufacturing Hall of Fame.

How do you define innovation and what does it mean to you?

I think of innovation along a continuum of 1) basic problem solving to keep the train on the tracks, 2) continuous improvement to make the tracks work better and better and 3) innovation to question whether tracks are needed at all.

What industry needs to embrace innovation and take more risks?

I don’t know that innovation necessarily means taking “risks.” Not innovating may be riskier! I’m thinking that the day of the big, risky bet may be over.

But, it really depends on what we mean by “risk.” Must we accept that failure is always possible, even in what appear to be the surest of circumstances, and often highly probably in conditions of higher uncertainty? Absolutely. I think the issue is one of acceptance of the fact that we will often experience failure at one level of another.

What is the best piece of advice that you have been given and received?

You don’t know what you don’t know.

What is your greatest achievement and why?

Helping make the Toyota-General Motors joint venture called New United Motor Manufacturing, Inc. or NUMMI in Fremont, California, – a success. NUMMI’s success led to the lean thinking movement.

Newspapers and Books: Digital or Physical?

LOL – it’s not a matter of either-or, is it? A lot of my friends still ride horses.

What are the greatest lessons that you learned when you moved to Japan to study management?

While culture matters, never use culture as an excuse. There is always a way to engage people creatively in their work and some basic principles apply everywhere. Humans are naturally creative and can respond to challenge. Management’s job is to direct and unleash those natural innovative instincts. Even repetitive work like assembly lines that on the surface appear mind-numbing can be made fulfilling through concerted effort by managers.

How were you able to change the culture at the General Motors/Toyota NUMMI Plant and implement innovation at all levels throughout the organization in about a year?

We helped them to not suck. Nobody wants to suck. We had a population of people – union workers – who for years and years had been told by everyone that they suck. We told them, no you don’t, or, if you do, you don’t have to. We can show you how not to.

What companies today do you feel could benefit from adopting and implementing Lean Thinking into their organizations and why?

Any. Businesses in environments of relatively high-certainty will learn to elevate their game to take advantage of that stability (reducing variation even more and eliminating waste). Businesses operating in conditions of high uncertainty will learn to mitigate risks through quick, disciplined learning cycles.

Starbucks is a great example of an organization which has implemented Lean Thinking to eliminate “muda” in the supply chain. Besides Toyota, is there another company that you can talk about that has implemented and benefited from Lean Thinking?

Starbucks is using lean in the stores, not the supply chain. Their supply chain is totally traditional. But their application of lean thinking in their stores is creative, effective, and fits beautifully with their operating structure as well as culture.

Another excellent example is the innovative Wisconsin healthcare provider Thedacare. Thedacare learned about lean thinking from a local manufacturing company and has steadily applied lean thinking to just about every aspect of healthcare provision. Significantly improved outcomes (and they make all their performance outcomes transparent), steadily reduced costs, improved patient AND employee satisfaction – the list goes on. They’re fantastic. Google them.

What can Design Thinking teach us about Lean Thinking?

Lean Thinking has Design Thinking embedded in it. The Design Thinking community does, however, have some techniques, vocabulary and…flavor…that can inform and enhance lean practice in knowledge based or creative environments.

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