Management Skills Replaces Kanban – Is Kanban Failing Japan?

“The essence of capitalism is that competition is the source of progress.”

This was said by Akihiko Nakauchi, Chairman Colombo Dockyard plc, delivering a lecture on “A Journey beyond Lean-A Japanese Overview,” in Colombo in March, 2012.

The lecture was organized by the Japanese Graduates Alumni Association of Sri Lanka. The majority shareholder of Colombo Dockyard is Onomichi Dockyard, Japan. He said that one of the significant causes for the decline in Japanese industries is that “lean management/The Japanese way” or Kanban is no longer the only one, most efficient, strongest and productive management skill anymore.

The Kanban supported automobile and electronics industries have been the backbone of the Japanese economy for a long time.

Management Skills Replace Kanban?

A Japanese newspaper recently quoting a Korean executive of having had said that the Japanese Kanban was no longer a threat to them. By taking advantage of the most advanced IT technologies, some companies have created the new concept called “management skills” which are superior to Kanban by taking advantage of the most advanced IT technologies, said Nakauchi.

Only the person or company who could create and establish new concepts of management skills by using endlessly progressing technology and business models/ strategies and integrating soft and hard skills will survive, said Nakauchi.

He said that companies such as Apple USA and Samsung Korea have integrated all the necessary activities of the company like production, monitoring, marketing, procurement, logistics and sales into one system, thereby achieving high performances. This system is called “smart transformation.”

Kanban is about eliminating seven wastes, namely over and/or possibility production, standby time, movement and/or transport of products, manufacturing process, stock, movement of workers and defective products.

But is the poor performance of Japan’s automobile and electronics industries because of Kanban? Or is it more around utilizing “smart transformation” and highly advanced IT technology?

In the meantime the Japanese economy lost its number two status to China. Large Japanese electronic companies such as Panasonic and Sony are reported to have had made enormous losses last year.

Meanwhile Toyota, in the world’s automobile ranking has slipped from number one to number three last year, said Nakauchi.

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5 Responses to “Management Skills Replaces Kanban – Is Kanban Failing Japan?”

  1. Ken 'classmaker' Ritchie
    April 18, 2012 at 9:38 am #

    How about a Personal Edition? 

    Seriously! I’m already trying to integrate and balance all my soft and hard skills.  I know that improving my “self-management skills” is essential to achieving a “smart transformation” of myself to perform better, serve better.  

    I was leaning toward adopting Kanban and limited WIP to improve my own cycle time, throughput, and agility. My scope is nothing less than integrating all the necessary activities of my life.  Indeed, I feel the need to augment my self-management skills with some kind of holistic and advanced IT capability. 

    Is there an App* for that?

    –Ken ;-) 

    *PS, I’m not kidding. I want that. If I can’t buy it, I’ll build it!  

    • peter
      April 18, 2012 at 10:36 am #

      Management, at the end of the day, and… rather… management skills, are really the backbone of how you apply methods (like kanban). If deployed poorly, you can’t blame kanban, or scrum, or agile necessarily.

      It’s an interesting turn-around — back to just… could you say… common sense and good (holistic) management practices?

      • Karol McCloskey
        April 24, 2012 at 9:17 am #

        Read a recent article that stated the failure was Mgt’s continuous and ruthless attention to cutting costs of production, without taking the long view. Author suggests Mgt lost sight of providing real benefit to customers; they forgot [how] to innovate. Which brought Sony and peers to this point. It’s a big #fail on management’s watch.

        Poor deployment of many processes? Quite possibly overuse of methods w/o taking “change” and “effects” into account.

        Then, I cannot help thinking the earthquake, tsunami and nuke plant disasters must have made a bad problem worse.

  2. Mark Kennaley
    April 18, 2012 at 1:04 pm #

    Kanban (with a capital K), which represents a myopic focus on exploiting constraints using the 5-focusing steps from ToC using WIP LImits and buffers for a serial process (before elevating those same constraints using more effective practices that yield large-scale leverage) is yet another in a long line of silver bullet thinking. To ignore the effects of strategic technology choices in any endeavor is like saying we will compete in something like “The Amazing Race” with a Cessna, when the competitors are leveraging a 747.

    Simple example – using modern 4GL PaaS technologies, we can collapse the entire delivery value stream into one person for what we mostly see today with common biz apps – that person being an empowered business person with domain knowledge – once technical complexity is removed from the equation. Think of it like supercharged MS Excel but with the reach of the web; the business and IT blurred as one and the notion of “shadow-apps” taking a front seat. The point – all this talk about team this, flow that is entirely dependent on strategic decisions we make in the fuzzy front end. Similarly, TPS without TPDS is rather myopic…

    If we are truly thinking Lean, we would constantly question the entire value-stream, not just one small portion, always settling on removal of Type II muda and ignoring Type I muda. Pull and flow has its place and context – but ToC and Kanban is focused on merely tactical improvement relying on a long drawn-out emergence process.

    To see what I mean related to the complexity of what typical Lean IT Value-stream looks like, and how many choices teams have to make related to configuring the value-stream (the entire stream that is, unless they are being myopic ) at http://www.software-development-experts.com – a real example of what Nakauchi-san is referring to as “Smart Transformation” and thinking of a holistic system…

    • peter
      April 18, 2012 at 1:25 pm #

      Love your comments man! Thanks for taking the time to let us know your thoughts.
      Lean is totally a more holistic approach. I would agree that Nakauchi’s comments a little narrow minded… but regardless, they are thought-provoking. Makes you have to consider the bigger picture at large.

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