Visual Management Boards

Akinori Hyodo, former Factory Manager, Toyota HiAce Factory | #AskSensei Event 19 Summary

Visual management boards are a useful tool to have in your workplace. The tool allows you to grasp the necessary information at a glance and helps you to keep track of your operations against your set goals. However, if you have visual management boards in your workplace, are you using the tool correctly as it is truly intended? Akinori Hyodo discusses the idea of visual management boards and explains how you can best utilize this lean management tool.

How to Use Visual Management Boards

We will be talking about visual management boards today. I trust there are already various visual management boards scattered around within the companies of everyone who are joining us today. I’d like to ask you why you have those management boards in your workplace? Why are they there?

I believe most of you joining us on this webinar are in the position of supervision or management within your companies. This means that based on the role you have, you are responsible for managing and controlling various things that take place in the area you look after.

Irrespective of the section or department you are responsible for within your company – whether it be manufacturing, logistics, quality etc., common themes that run across all of these areas are those related to safety, quality and cost. In addition, as our companies are made up of different individuals, we also need to be developing those people and this is another common theme across all different areas of an organization.

We must be able to control our areas according to the themes we identify by understanding how we are performing. And, having all those pieces of information visually displayed on boards in one location helps us to do this effectively. This is the idea behind visual management boards.

Since visual management boards are a tool for us to be able to manage an area, you must use this tool regularly. Please reflect on this point for a moment. Are you using this tool in a true sense at your workplace? Just like any other tool you may have, unless it is used regularly and frequently, the tool will just rust away and go to waste.

So, for these boards to be useful for you, you need to be able to identify problems from the information displayed on the boards. You need to be able to identify where the problems are and how you are tracking against resolving them.

However, what needs to be managed will be different at different levels of the organization. That’s why you need to clarify what needs to be tracked and managed at your level of organization. Once those points and purposes are clearly identified and the relevant information is visually displayed on the management boards, you should be able to clearly understand the current situation of the area that you are looking after when you stand in front of the management boards.

As for Toyota, we always start our shift by having a meeting in front of the management boards. When a manager comes to the shop floor, the first place he/she checks before visiting a particular area will be the management boards. This is because we can quickly understand where the problems are in that area by looking at the information displayed on the boards. This then will help us determine where we need to focus our attention while we walk around the area on the shop floor.

To give you a more specific example, generally speaking, we also have a management board that shows the performance of the process or the line located at the end of that process or line. The information we track on that management board are an hourly breakdown of the target and the corresponding result for each hour. And, when there is a gap between the target and the actual result, we also document on that board what the problems were and what measures were taken against those problems.

The reason why we track our performance against our target on an hourly basis is that in a manufacturing operation, there is a condition that we achieve the targeted volume by the end of the shift. So, if we are not tracking how we are performing against the target throughout the shift, we may find at the very end of the shift that we haven’t achieved our target and thus we won’t be able to fulfill the demand. That is why we track our performance hour by hour and when we have a problem we take appropriate actions to make sure we achieve our production target for the shift.

There are various things that happen throughout the course of a shift and if we are not addressing all those issues until the end of the shift, it may be too late and we may not be able to fulfill our target for that shift. In an ideal world, we would be tracking our performance part by part or product by product. But, it is not realistic when you consider the investment of time that goes into that degree of management. So, we break it into hours so that we can understand the problems we have within each hour and address the problems as they are identified in order to prevent them from occurring again later on. Tracking our production progress hourly helps us to achieve our planned target more easily for the shift.

The first key objective of the visual management boards is to enable those who are in supervisor and management positions to understand where the problems are and quickly address them to help them achieve their target for the shift. Therefore, they must ensure that management boards function as a production management tool in the way I have just described. Unless they are able to do that with the management boards they have, there is not much point in having them there. This is one of the key points we need to be achieving through having management boards on our shop floor.

The second key objective behind having visual management boards is to provide information for everyone working in that area. That information displayed on the management boards is visible and open for everyone in the area to see and this provides the team working in the area with some visual feedback in regard to the efforts they put into their work for the shift.

In the end, what the company is seeking to achieve through these efforts is increased profit. In order to achieve those profits, the company must have various targets put in place against various different themes that need tackling.

As far as a manufacturing operation and its management are concerned, the fundamental premise for them to be able to generate profit is for them to fulfill the required demand within the required time. It is also critical that they produce good quality products at a lower cost in an efficient manner. That is why the KPIs they track must reflect and address all those points and all of those KPIs must be displayed visually on the management boards.

Further to that, in order for those KPIs and the corresponding results to be processed and utilized properly, it is crucial that we have a target or a standard written on the information so that we understand whether things are going well or if there is a problem.

As I mentioned earlier, the key indicators that need to be tracked are around safety, quality and cost. However depending on the level of the organization and the objectives that they are trying to achieve at each level, the details of what needs to be looked at under each of these themes can be different. That’s why it is important to make it clear what the supervisors, managers and those above them want to understand from the management boards regarding the area they have the responsibility for and what indicators must be tracked and in what frequency they should be tracking and managing the operation depending on their level of management.

Having said all this, when you have visual management boards in place at your workplace, what’s most important is to fully utilize the information on the boards as a tool to manage your area and your part of operation. Based on my experience visiting and seeing a lot of companies around the world that have implemented this idea of management boards, I see many companies focusing more on the attractiveness of the design rather than the actual usefulness of the information as a tool for management.

So, when you set up these boards, I really encourage you to make sure you have the objectives clear and actually use it to manage your work area effectively. Also, you must ensure that the company’s overall objectives and expectations from those higher up in the organization are clearly displayed on the information on the boards in the form of a standard and target so that you can understand whether you are tracking well or not.

It is important that those at the top of the organization communicate with the rest of the organization clearly what direction they want their company to take with regard to the objectives and targets of the company and provide instructions for those in lower parts of the organization to carry out the work and activities to achieve the targets the company is setting. So, while activities are happening at the lower end of the organization, the results of those activities must be visible on the boards. Therefore, management also needs to be checking the information on the visual management boards and providing feedback on a daily basis.

The cycle of what I have just described has to be repeated over and over again to make sure the targets put in place will be achieved.

Audience Q&A

What would be the pros and cons of using digital management boards?

With regard to the difference between displaying handwritten information and printout copies of digital information on the boards, there is no set rule as to what needs to be handwritten or digital. But, I question the efficiency of printing out all of the information that needs to be tracked and displayed on the boards on an hourly and daily basis every time the information is updated. That’s why, it is common within Toyota that information that goes onto the management board is updated by hand. In the case of digital information, someone needs to be inputting the information into somewhere at some point. If you are expecting your team leaders to be putting the information into a digital system throughout the shift, I question whether you are giving them the full ability to be able to manage all the problems that occur throughout the course of the shift. Expecting team leaders to work on such tasks takes valuable time away from them and erodes their ability to manage the area directly as they are busy throughout the shift dealing with various issues.

Having said that, I can certainly appreciate the benefit of having information in a digital format in terms of having it stored digitally in a system. If the information is something that you want to use somewhere down the track, having it digitally available and managed will be useful.

But, generally speaking, it would be more beneficial in doing things manually at the shop floor team level. However, once you go up to another level, it may be better if information is used and managed in a digital format. There must be a point where you can decide which is a better approach based on your needs and the time spent in capturing necessary information manually or digitally. At any rate, I am not against putting things in a digital format as I can certainly understand the benefit and convenience of having information in a digital format. The important thing is you assess the merit and demerit of the two approaches based on your situation and utilize both approaches depending on your needs and purposes.

Here is one piece of advice I wish to put forward for managers higher up in the organization who are using digital information boards or even their computers to manage operations. You should ask the question whether you are truly understanding what is exactly happening in the area you are managing on the shop floor. On the manufacturing shop floor, things can change within a matter of seconds. Can you grasp that on a computer screen? I would think you need to go to the shop floor and confirm that information for yourself at the actual site.

Those are the points that you need to consider. So, think about what is the best form and approach for you to be able to effectively and efficiently manage the area and the operation that you are responsible for.

What elements do you consider necessary to include on a management board? For example, we often see safety, environment, quality, cost, delivery and people.

As I touched on during my opening remarks, the four key themes are safety and environment, quality, cost as well as the development of people. They are quite common elements in many companies particularly in manufacturing. And, what is actually monitored under each one of those themes will be slightly different depending on the situation of each company and what objectives they are trying to achieve.

Now, I will give you an example under the theme of quality. Most importantly, you must guarantee what you have promised to your customers. Therefore, the first indicator you must be tracking is the complaints and claims you receive from your customers. The second one is the quality defects and issues that made its way out of your process through to the following process and the third one is the in-process quality issues that you caught within your process before it passed from your process to the next.

With regard to the first indicator, i.e., claims and complaints from your customers, they can be tracked on a monthly basis as I suspect there are not too many defects that end up escaping to the customers as in many cases the majority of quality issues are detected before they get into the hands of customers. But, as for the inter-process and in-process quality issues within your operation, you may wish to track them on a daily basis against the target level set by the company around the defect rate. And, they should be clear in the information displayed on the management board tracking such information.

A couple of additional ones you may want to consider under the theme of quality are scrap rate and first-pass yield or first time through quality (FTT) which is an indicator around what percentage of product is leaving the end of the process and going directly through to the next process.

I trust that this type of information should be available and kept in records as data in most companies in general. But, as I said earlier, you need clarity around what you need to be tracking and at what frequency you should be tracking in order to manage and control your daily operation. Therefore, depending on your objectives, what indicators you will be following would be different.

How is the team able to manage the production and updating information on the management boards? How is it managed in Toyota?

#AskSensei Webinar

Up-coming #AskSensei Events and Registration

For further information about the #AskSensei webinar series, please refer to our #AskSensei overview page.