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Lean Product Development as a System: A Case Study of Body and Stamping

Development at Ford
Article in Engineering Management Journal · April 2015

DOI: 10.1080/10429247.2011.11431884
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Lean Product Development as a System: A Case Study of Body and
Stamping Development at Ford
Jeffrey K. Liker, University of Michigan
James Morgan, Ford Motor Company
Abstract: A systems view of lean product development is In the Japanese auto companies, a chief engineer had an overall
presented integrating people, process, and tools. This systems vision for the product and helped integrate across departments to
approach was derived from intensive study of Toyota’s product enable simultaneous engineering.
development system. Principles and methods based on this The concept of lean product development has been emerging
systems model of lean product development were applied with in practice as companies have some success in manufacturing
great success at Ford Motor Company helping to bring to market and find that the design of the product becomes the bottleneck.
a record number of products that helped fuel a rebuilding of the There are two major competitive advantages in implementing
company to financial success and award winning world-class lean product development. First, it is an enabler to achieve the
product quality. next level of lean manufacturing. Those trying to implement lean
production on the shop floor find various barriers arise such as
Keywords: Lean Product Development hard to assemble parts, lack of modularity that could facilitate cell
design, lack of error proofing that makes built-in-quality difficult,
EMJ Focus Areas: Innovation & New Product Development, lack of standard parts or tools required to build the parts, and
Management of Design & Consulting Engineering Organizations, long lead times when engineering changes are requested. Second,
Organization & Work System Design it improves product development performance. New products
are the life blood of many companies and often represent
major resource investments. Consequently senior executives
T
have grown interested in lean product development in order to
he term “lean” was introduced in “The Machine that improve market responsiveness, reduce costs, design in quality,
Changed the World” by Womack, Jones, and Roos (1991), and dramatically shorten lead times.
first conceived in 1984, as a new “paradigm” supplanting The challenge then becomes to define lean product
the prevalent mass production system. Mass production is based development. In manufacturing you can walk the floor and
on a principle of quantity where more is better. Each process identify inventory buffers and repair bays so the waste is visible.
builds to its own schedule and pushes inventory onto the next There is not a lot to go and see in product development, and
process resulting in large inventory buffers. The inventory buffers translating the concepts from lean manufacturing to lean product
protect processes from each other—if one process shuts down development is challenging.
or is slow it will not affect the next process until the buffer runs There are at least two different approaches to this challenge.
out. Lean production is based on the principle of just-in-time, First, start with lean production as the model and extrapolate
building only the parts needed by the next process when they are from that. The original model for lean manufacturing was the
needed based on a pull system. Processes are tightly coupled so Toyota Production System (TPS), and we can seek to draw
problems in one process have an almost immediate impact on direct one-for-one analogies between a feature of TPS and a lean
other processes in the linked chain. Mass production emphasizes product development concept. This has been a common practice
cost reduction within processes through economies of scale, while in the growing area of “agile” software development. For example,
lean production emphasizes flexible response to the customer Ladas (2009) introduced to software development the concept of
building in quality at every step of the value stream. “scrumban” which is a direct application of the TPS tool kanban.
Lean production has been implemented all over the world Reinertsen (2009) draws on technical concepts of batching and
and now is the dominant paradigm in manufacturing, though queues from just-in-time using these as analogies for how to make
it is questionable how effectively and consistently it has been product development flow across steps, rather than being pushed
implemented (Liker, 2004); however, often ignored were the other from step to step. He uses concepts like reducing batch size,
chapters in the Womack et al. (1991) book that focused outside of applying constraints on work-in-process, decentralizing control,
manufacturing, particularly the chapter on product development. and accelerating feedback. These are all common concepts as a
This chapter was based on the research of Clark and Fujimoto company shifts from mass production to lean manufacturing.
(1991) who compared American and Japanese auto companies A second approach is to go back to the original company
and found a striking difference in organization and management. that became the model for lean manufacturing—Toyota—to see
American companies had organized product development into if they also have a model for lean product development. As it
silos of expertise, and there was poor flow of information across turns out, they are in many ways the leaders in the automotive
functions. Information was pushed from concept to detailed industry in important product development performance
design to tool design until it finally reached production. At each measures such as lead time and long-term dependability of
step the function involved would have to rework elements of the vehicles resulting from effective system integration. A series of
design from their point of view, e.g., tooling engineers changing books and articles have documented various aspects of Toyota’s
design features to make the tooling work at an affordable cost. product development system. Ward et al. (1995) first observed
Refereed research manuscript. Accepted by Special Issue Editor Geert Letens.
16 Engineering Management Journal Vol. 23 No. 1 March 2011

what they called “set-based concurrent engineering”, considering learning to leverage lessons learned anyplace in the
broad sets of alternatives and even keeping different alternatives company. A true lean system drives people to continuously
open as options until late in the development process. This improve toward increasingly challenging targets (Rother,
practice also affected the way they communicated requirements 2009), stretching and testing the organization to create a
to suppliers who also practiced set-based design (Liker et al., culture of excellence.
1996). In general, Toyota has much closer relationships with 2. Process: This fits fairly well with Reinertsen’s (2009)
a close-knit network of systems suppliers who are intimately discussion of making product development flow, but also
involved in product development from the early concept stage emphasizes the importance of precise cross-functional
(Wasti and Liker, 1999). Kamath and Liker (1994) observed that synchronization, as opposed to the traditional “waterfall”
Japanese automakers tend to source complete systems from their model of product development where each function does
largest supplier partners so that the suppliers can work relatively its work independently and then a large batch of work is
independently. Ro et al. (2007) distinguish systems from modules. pushed onto the next process in series. Ward (2007) argues
Systems, i.e., the electrical system, can run throughout the entire that a better approach is set-based concurrent engineering
car. Modules are physical chunks of the vehicle that are relatively in which sets of ideas are developed cooperatively across
self contained. They observed a movement toward designing the functions and then flow through to downstream processes.
car as a set of modules in the U.S. and Japanese auto industries, Morgan and Liker call this early, set-based process “front-
but since the Japanese companies were already more integrated end loading” and show how it allows for a smoother leveled-
with supplier partners, they were more effective in using this flow of product development. Clark and Fujimoto (1991)
practice in order to allow suppliers to work independently on illustrated that with proper planning, parts of the design
their modules and take out cost through means like part count can be released downstream early to allow simultaneous
reduction and design for manufacturability. development of the product and processing to the point
These studies have each defined an important aspect of lean that tools are actually being cut before the total design of
product development, but they are described in isolation. Several the automobile is complete.
books that directly analyze Toyota’s product development system 3. Tools and Technology: Toyota has all the usual product
in its entirety see it as an integrated system (Morgan, 2002; Ward, development tools such as Computer-Aided Design and
2007). Morgan and Liker (2006) describe it as an integrated Computer-Aided Engineering, but puts a greater emphasis
system of people, processes, and tools defining each of the three than other companies on standardization and visualization.
subsystems as (see Exhibit 1): This includes standardizing skills of engineering experts,
1. People: Toyota uses a chief engineer system (Clark and the development process, and product and process
Fujimoto, 1991; Ward, 2007; Morgan and Liker, 2006) as the characteristics (Morgan, 2002). Sobek et al. (1998) see the
systems integrator from concept to production launch along potential tradeoff between standardization and flexibility
with a matrix organization that allows technical specialists as a balancing act. Too much standardization can stifle
to reside in functional units. The functional units are led creativity, but too little standardization means each design
by expert managers who focus on training and developing project is treated independently of those that come before it
experts with “towering technical competence” (Morgan and and there is no organizational learning. Toyota intentionally
Liker, 2006). A strong customer-based culture is deliberately limits the amount of innovation in any new vehicle program,
developed by the most senior management to encourage carrying over parts and vehicle architecture, and focusing
cross-functional focus on the customer and organizational innovation on specific aspects found to be of high importance
Exhibit 1. The Thirteen Principles of the Toyota Product Development System*
5. Develop a “Chief Engineer System” to Integrate 11. Adapt Technology to Fit your People and Process.
to
Development from start to finish. 12. Align your Organization through Simple, Visual
o
le
ls
6. Organize to balance Functional Expertise and Communication.

op
&T
Cross-functional Integration. 13. Use Powerful Tools for Standardization and

pe
7. Develop Towering Technical Competence in all Organizational Learning.

ec
lean
ed
Engineers.
hn
Product
ill
8. Fully Integrate Suppliers into the Product

ol
Sk
Development System. development

og
9. Build in Learning and Continuous Improvement. system

y
10. Build a Culture to Support Excellence and

Relentless Improvement.
Process
1. Establish customer-defined value to separate value added from waste.

2. Front load the product development process to thoroughly explore alternative
solutions where there is Maximum Design Space.
3. Create a leveled Product Development Process Flow.
4. Utilize Rigorous Standardization to Reduce Variation, and Create Flexibility and
Predictable Outcomes.
* Exhibit taken from Morgan, James M. and Jeffrey K. Liker, The Toyota Product Development System: Integrating People, Process, and Technology, Productivity Press (2006).
Engineering Management Journal Vol. 23 No. 1 March 2011 17

to customers (Morgan and Liker, 2006). Visualization is to create a Ford system of development. In addition to Toyota,
important so that individual engineers can work effectively a major source of insights and methods was what Ford learned
as a team. One tool to support cross-functional collaboration from Mazda. A team of people drawn from each of the major
is the obeya or “big room” methodology. Data is carefully functions of automotive engineering were pulled together to
laid out on the walls by functional discipline telling a story bring their collective wisdom to bear on the design and testing of
of the current status versus targets and problem solving to a Ford system using Mazda as a benchmark.
eliminate gaps. Regular meetings are held with the chief The methodology of this article can be viewed as a reflective
engineer to solve difficult cross-functional problems. case study. Kotnour and Landaeta (2004) describe this research
method as reflecting on live experience with a project, or in this
In this article we draw on the Morgan and Liker (2006) view case transformation, to develop lessons learned for the practicing
of lean product development for two reasons. First, we believe it manager facing similar situations. We believe this case study
is the most comprehensive system’s view of lean development. In illustrates the importance of viewing lean product development
our experience working with many companies, lean approaches as a system and the complexity of the interrelated transformation
that focus on selected lean tools in isolation have limited success. of people, processes, and tools.
Second, it was the approach adapted by Ford Motor company, An academic journal presents factual accounts, and we
the subject of this case analysis, as one of the authors (Jim do not want to suggest that either Toyota or Ford has a perfect
Morgan) led one of the teams that helped define Ford’s lean product development process or perfect engineers. Large,
development system. complex engineering organizations developing large, complex
Liker (2004) argues that both TPS and lean product systems will always be far from perfect. What we do stand behind
development are reflections of a deeper philosophy called the are the principles of lean product development that represent an
Toyota Way. The foundation of the Toyota Way is a long-term ideal toward which companies can strive. The philosophy of lean
philosophy of adding value to customers and society. There is product development is to surface problems, solve them one by
a passion for customers that goes beyond short-term financial one, and then learn so the same problems are not repeated. This
considerations. This allows Toyota to make large investments in is the backbone of what made Toyota, and more recently Ford,
developing people and lean processes simultaneously (Liker and so successful.
Hoseus, 2008). The method for doing this is problem solving In this article we will illustrate the transformation to lean
based on what Deming (1986) taught as plan-do-check-act product development as a system using one part of Ford Motor
(PDCA). The philosophy behind PDCA is that we can never Company. In the mid-1980s Ford began a lean manufacturing
know everything at the outset of a complex project, so we must process called the Ford Production System (FPS). At the same
thoroughly identify the problem in the planning stage, find the time, they were working on lean product development though
root cause, put in place countermeasures in the do stage, check with a tiny allocation of resources compared to FPS. There was
on what happens, and then learn from this by putting in place limited implementation of lean product development until 2004
further actions based on what we learn. Set-based concurrent when Ford created the Global Product Development System
engineering can be viewed as an example of PDCA in action. (GPDS) which utilized lean enablers modeled after the Mazda
The entire development process for one program can be viewed product development system, and allowed Ford to leverage
as a large PDCA loop in which we learn how to better manage their strengths as a multi-national and move to a global product
programs, and each individual piece (e.g., designing the muffler, development process. At that time the Mazda system had
designing a tool, piloting a new manufacturing process) can be considerably shorter lead time and was much more efficient than
viewed as smaller PDCA loops. the Ford system, while doing a better job designing in quality.
The descriptions that have come from studies of Toyota give a Mazda had already assimilated many of the lean concepts which
rich picture of lean product development as a system. It becomes they customized to fit their unique environment. In order to
clear that simply implementing a tool like scrumban, or trying to learn deeply from the Mazda system and bring it into mainstream
implement a new process based on controlling work-in process, product development at Ford, the GPDS lead put together a team
will not by itself transform product development. It is as much a of respected engineering leaders and piloted various enablers of a
revolution in how people are managed and developed as a technical lean PD process. Each pilot was successful on its own, but they did
methodology. Unfortunately, the cases of actually transforming not immediately lead to the development of a true lean system.
a company to lean product development outside of Toyota are In 2004, these pilots went mainstream back to their home
very limited. Kennedy (2008) wrote a lean novel to illustrate functional engineering organizations in order to more deeply
hypothetically what this should look like, though in our experience embed the lean concepts. Morgan was assigned to lead stamping
it provides a simplistic view that suggests much faster and greater engineering which became very successful and eventually
impacts than would be expected in practice. Another business novel matched their best Japanese competitors for quality, lead time,
(Kennedy et al. 2008) includes two actual cases of transformation and cost. Then in 2006, Ford took the unusual, but highly
that do a better job of illustrating the real challenges. successful, step of organizing around the body development value
This article documents a unique opportunity to study in stream combining both Body Exterior Engineering, traditionally
detail the lean transformation of one major automotive system a Product Engineering organization and Stamping Engineering,
within Ford Motor company. Upon completing his dissertation traditionally a Manufacturing Engineering organization into
documenting Toyota’s product development system (Morgan, a single, global team in order to more fully leverage lean PD
2002), Morgan was hired by Ford to help lead the creation of concepts. As you will see, this was key to both the level of success
a lean development system. This provided an opportunity to and the speed in which changes were able to be implemented.
apply what he learned from Toyota in a new environment, and We will focus on the transformation of this one critical part
new organizational and national culture. The goal was not to of Ford Motor Company—automotive body development to lean
copy Toyota , but rather to use principles learned from Toyota product development. We are including in body development all

the stamped and welded steel structures of the underbody, upper development principles and Toyota’s system. Together, with key
body, and closures. Body and stamping development is on the team members, they drove many of the core practices.
critical path of all new vehicle programs in the auto industry and For example, a cornerstone of his strategy was globally
historically a major bottleneck to launching new models on time, shared platforms and parts commonality. Toyota had gotten
at targeted cost, with high quality. The transformation of this significantly ahead of Ford in the number of different car models
critical development stream made a significant contribution to derived from the same platform and had many more common
the remarkable turnaround of Ford Motor Company. We start by parts. Toyota’s engineering is highly centralized in Japan and the
giving background on the Ford turnaround. executive VP of R&D has complete global control. A barrier to
following this strategy at Ford was decentralization of product
Case Background: Automotive Body Development at Ford development split between many offices in Michigan and other
Ford’s product-led revitalization has been broadly recognized. In local vehicle development centers in Ford of Europe, and at the
addition to being the only U.S. car manufacturer not to declare time in Volvo. Even within a country, each program manager
bankruptcy (in fact they made multibillion dollar profits in 2009 treated their vehicle as if it were unique. The global GVP had to
and 2010), their stock rose 346% since 2009, and Ford’s industry- take a hard line on a case-by-case basis refusing to compromise
best quality, innovative, award winning string of new product when engineering managers pleaded their case for why they were
introductions has been unprecedented. Their hyper-aggressive different. The result was a rapid move over several years to match
strategy of new product introductions resulted in annual market Toyota in platform commonality.
share gains to once again become the number two automaker As the turnaround of Ford was evolving, lean product
in America with the freshest product line-up of all automakers. development matured from application of tools in specific
Ford’s 2009/2010 Initial Quality results are slightly higher but areas to integration of people, processes, and technology. Body
statistically tied with Toyota for best in the world. In 2010 Ford engineering requires a high level of integration between the
was ranked by the JD Powers Initial Quality award as the highest of stamped body parts, die design and production, the stamping
all full line auto manufacturers, had more top ranked name plates process, and the vehicle platform. Part standardization required
than any other manufacturer, and saw the Lincoln body exterior the definition of common vehicle architectures, i.e., the structure
called out as most improved. Finally, Ford climbed more than of the inner hood of the car. The evolution of lean product
35% over 2009/2010 in Consumer Reports Car Brand Perception development in body engineering was eventually facilitated by
to be statistically tied for the top brand. Additionally, according reorganizing it under a global director who had responsibility for
to Consumer Reports, “Ford excels in the factors consumers care body engineering, tooling, and stamping worldwide.
about most.” The all new Ford Taurus was named highest quality We will go into some detail on how the development of the
vehicle in North America, the Ford Fusion was the 2010 car of exterior vehicle body, including stamping engineering and tool
the year (best mileage of any midsize sedan), and the F150 was and die manufacture, shifted gradually from mass to lean thinking.
the 2009 truck of the year. Also contributing to Ford’s success are We want to emphasize the critical role of people throughout this
industry leading safety, radically improved vehicle craftsmanship process. The tools by themselves would not have been seriously
(fit and finish), and new innovative technologies such as the used and, in fact, became subordinate to the transformation
award winning Synch, “Ford My Touch”, and “My Ford Key” on process of people, organization, and leadership. A diverse group
new products. of talented, technical people must be enrolled in this highly
Alan Mulally, formerly a Boeing executive and brought in complex process if it is to succeed. This was an evolutionary
by former CEO William (Bill) Clay Ford, Jr., was named as CEO process, greatly accelerated by the business crisis of the company
in September of 2006. In 2006 Ford lost $12.7 billion. Bill Ford, and the unrelenting vision and passion of the top of the house.
brought in to save the company from bankruptcy, passed the Body exterior engineering is responsible for the design,
baton to Alan Mulally to lead the “Ford Way Forward” plan. It release, and testing of everything you see (and much you cannot)
included borrowing $23 billion against the assets of the company, on the outside of the vehicle excluding the wheels: body structure,
literally betting the company, and the bold announcement that closures, glass, lights, trim, hardware, and small motors. Stamping
Ford would close 14 U.S. manufacturing plants, buyout 30,000 Engineering is the process of design and construction of all tools
hourly workers and reduce the salaried workforce by 15,000 and dies required to manufacture all metal components on the
people. Closing plants and laying off people is not unusual in a body. Together with assembly they help deliver passenger safety
failing company, but Mulally’s less publicized and perhaps more and comfort, exterior design as created by the studio, safety, and
important move was unusual. He decided to channel as much of contribute to vehicle ride characteristics such as handling, noise
this money as possible into new product development. Mulally and vibration, aerodynamics, weight efficiency, and many other
realized that if Ford were to succeed it would need to be led by quality and craftsmanship characteristics.
great new product, with every product being a winner.
Another key move by Mulally was to appoint Derrick Kuzak GPDS as a Lean, Global Product Development Strategy
—the former vice president of product development for Ford In the mid-1990s Ford began a global business process
of Europe—to become group vice president of global product reengineering effort. Included as core value streams were
development. This was an important executive promotion for lean manufacturing and product development. The manufacturing
product development because it also reflected a reorganization effort led to the creation of the Ford Production System (FPS)
of the company. The new group vice president was given a level and the Ford Product Development System (FPDS). One only
of global responsibility, including all headcount and associated had to look around the room during these reengineering efforts
budget, previously missing at Ford. Ford engineering was eventually to witness the company’s priorities. An entire floor was filled with
reorganized around global platforms and global functional nearly 100 people to create FPS, and upstairs were a few cubicles
engineering organizations that cut across geographic boundaries. of engineers envisioning FPDS. Envisioning was about as far as
Both Mulally and Kuzak were knowledgeable about lean product the transformation in product development went.

Over the years the product development system morphed. every case Mazda was far ahead.
One version was “world-class timing” that divided PD into stages Each work stream team developed detailed development
and gates with targets for timing based on benchmarking best- time lines and identified gaps in productivity, lead time, and
in-class companies. Later, design for six sigma was added. One quality within each of these detailed steps in the process. For
thing that stuck was a phase-gate model. Within phases detailed each of these steps, they developed detailed plans in order to
processes were identified and mandated to be used by engineers. identify enablers to close gaps to best in world timing, cost,
Gate reviews were the audits of what had been done; passing or quality. Each had an A3 report (A3 sized paper and clearly
through the gate depended on a successful audit. When you audit laid out problem solving process) with appropriate supporting
something, especially when it is tied to performance appraisals, data, drawings, and pictures posted in the obeya. For most of a
people take it seriously, and interest starts to develop. The group day on a weekly basis the key teams met as a group where they
responsible for the stage-gate process had an interest in control, discussed coordination/interface or resource/resistance issues
and as they discovered more and more things engineering could and developed counter measures. Initial discussions were quite
do (best practices) they added them to the phases and audits. difficult, but the GPDS group of influential managers became
Product development groups have an interest in getting through zealots for the new methods and networked with their associates
the gates and, thus, doing the minimum needed to get their boxes leading the development groups which resulted in unrelenting
checked was becoming the objective. The result was ever-growing pressure for change from the top down.
complexity in the phase-gate model and ever-growing resistance One benefit of the obeya was that it became a place to come
from the product development groups. and see GPDS in action. The information on the walls was highly
In 2005, Jim Morgan was hired as a Director to help lead the visual – you could literally walk the walls to understand the status
creation of the GPDS. The group vice president of engineering at of the process. Visiting the GPDS obeya became a favorite activity
the time had formerly led product development for Mazda, which of a number of vice presidents. It was a refreshing change from
was partly owned by Ford. He believed Ford needed to learn viewing mind-numbing PowerPoint slides. This built support
from Mazda’s system. To launch GPDS the lean director divided for the transformation initiatives and led to a proliferation of the
the overall product development system at Ford into functions obeya process itself.
he called “work streams”, including body development, engine There was initially no attempt to integrate the existing
development, prototyping, and launch processes. It took several phase-gate model with GPDS. There was general agreement
months just to get people assigned to the GPDS effort who had that it had gone too far in creating a bureaucracy that added as
the respect and experience to lead GPDS within their functions, much waste as value. Adler (1999) makes a useful distinction
but with the help of senior leadership they got the level and between coercive bureaucracy and enabling bureaucracy. The
quality of people needed. phase-gate model had too much coercive bureaucracy, while
GPDS provided a high-level strategy to guide and orchestrate the new GPDS was attempting to develop enabling bureaucracy.
the role of each of the functional and program-based organizations A key part of the difference was that the coercive stage-gate
in product-process development. It allowed Ford to see how all the model prescribed in detail what to do and then audited to
various pieces fit together, to coordinate and synchronize the high check on whether or not this was being done. What the product
level development process, and to assign specific “deliverables” development teams actually did to get through the gates became
by subsystem at precise points in the development process. It activity to get through the gates—to a large degree on top of
would do no good to optimize isolated functional activities on the real product development activities. GPDS sought to evolve
their own. At best you end up with a “pocket of excellence”, and at lean product development behaviors that would become the
worst you create tremendous waste. GPDS also served as a central new way of working—penetrating actual value-added behaviors
knowledge repository and critical learning mechanism where the and stripping out waste.
various functions came together to learn from both the outside There was considerable success in each of the work stream
and inside of Ford. groups in piloting their activities. For almost two years these
GPDS organized into functionally-based teams of experts activities went on largely parallel to the majority of product
who were responsible for identifying key processes, people, and development programs. People throughout Ford were aware
technological enablers that would allow their home function to that GPDS was going on, and many knew something of a work
achieve required levels of performance. These teams also served stream pilot, but it did not affect them personally. This was by
as an on-going communication link with the various functional design since the goal was to pilot the methods and develop
organizations. Senior management reviewed progress across understanding from deep experiments, but to penetrate the bulk
regions on a regular cadence, championed key changes, and broke of product development at Ford required moving the piloted
down barriers as required. processes more broadly across the company. The approach to
The process of developing GPDS was used to model the spreading lean was for individuals from GPDS to move back to
processes and behavior desired in product development. GPDS their home departments to lead broader deployment.
itself can be viewed as a development process beginning with
a clear vision, continuing with conceptual design, and detailed GPDS Deployed in Body and Stamping Engineering
design within each work stream. This process was led using the At first when the GPDS role was purely a staff position there was
obeya (Japanese word for big room), a concept developed within a great deal of resistance—the usual retorts of “this can’t be done/
Toyota. Each work stream had a work stream leader and a section you don’t understand, our work is different,” and even implied
of the wall on which to visually display their activities. Each work threats of sabotage were common. It was imperative that the lean
stream developed a current state process flow map. The future PD message get through this “layer of clay” to the managers and
state was developed using Mazda processes as the model. The engineers who knew Ford was uncompetitive and could do so
work stream groups were flown to Japan to benchmark Mazda at much better. It helped significantly that the GPDS work stream
a very detailed level. As the GVP of engineering had expected, in leader had long “hands on” experience in the discipline.

Another major enabler at the time was Ford’s generally poor the originally benchmarked levels of performance. By this point
competitive position both as a company and in the arena of die you could sense the team’s relentless drive to be the best.
development, die making, and stamping launch processes. This There was a renewed focus on technical competence. Ford had
data was openly shared at every opportunity—at meetings at outsourced many critical engineering competencies to suppliers.
all levels, and with the United Auto Workers (UAW) to build a They lost a good deal of technical knowledge that was critical to
common base of understanding and create urgency for change developing great vehicle bodies. One of many examples of this was
across the organization. This data was also used to demonstrate to that Ford had no internal tool/die designers. It was clear that many
the most senior executives how critical body and stamping were of the changes needed to implement lean design were reliant on
to the development of the “top hat”—the term used for everything this key functional competence. Since Ford had none, they had to
from the platform up. It is, in fact, what the customer sees and go outside the company and hire experienced engineers. This was
what differentiates the car when they look at it—in a very real not easy considering Ford was in the midst of downsizing and
sense, the face of the company. The goal was to transform Body had to justify new hires in a period when long-term employees
and Stamping into a source of competitive advantage for Ford were losing their jobs. Through the support of the global GVP,
Motor Company, and the team embraced the challenge. they received the required resource allocation. They put a great
deal of time and effort into hiring the right engineers for both
What was Transformed in Body and Stamping their technical competence/experience—but equally important
Engineering? they made sure they had the right character to contribute to
Based on all the above work, the Body and Stamping leadership the hard work to come. For existing engineers and engineering
team planned and executed a comprehensive overhaul to the way supervisors, Ford developed Technical Maturity Models (TMMs)
they engineered and tooled exterior bodies. The journey was by engineering discipline and Individual Technical Development
challenging and progress was certainly not linear, but it resulted Plans (IDTPs) to ensure that Ford engineers were able to gain
in a far more effective process, stronger organization, and, most the appropriate level of technical excellence and ongoing
importantly, greatly improved products for Ford customers. We technical development.
discuss here some of the more critical enablers. Communication was streamlined. One problem in the past
was a cumbersome chain of command that separated working-
People Transformation level engineers from top management. “Skip-Level Meetings”
The Body and Stamping Engineering (B&SE) team started with helped to maintain a clear line of communication between
a critical look in the mirror. It was evident that if they could not leadership and the engineers. These informal meetings allowed
get the people, cultural, and organizational part of this right, small groups engineers a chance to talk directly to leaders several
it would be impossible for them to achieve world-class levels levels above them. The Body Exterior and Stamping Engineering
of performance. Great engineering/product development is Director took on assignments to improve tool sets, process flaws,
about people, and all the queuing theory, process optimization and people system inefficiencies and reported back to these same
workshops, and the latest digital tools in the world cannot make engineers at future skip-level meetings. Once the organization
up for lapses in this area. became global, this gave leadership a chance to have direct
They started with an attitude change. The focus of the dialogue with engineers around the world as they traveled. Many
B&SE team began a relentless focus on the customer, and they of the global processes error states were addressed very early in
set out to become key enablers to deliver value to the customer. the globalization process by getting direct feedback from the
In the past the engineering organizations were often perceived engineers in each region.
as roadblocks to delivering exciting designs, world-class Global B&SE All-Hands Meetings were held twice yearly.
craftsmanship and best-in-class vehicle attribute performance. Similar to “town halls”, these events gathered the entire
Engineering would often reject exciting design proposals, organization to review important initiatives, status of objectives,
world-class craftsmanship standards, and stretch ride and and updates on the overall business, and ask questions of the
handling attributes as “unfeasible.” This led to time consuming, B&SE Director and his leadership team. The meetings included
sub-optimizing “negotiations.” This painful process typically the global team through the use of audio-video equipment. The
resulted in vehicles that looked and performed like products latest models of vehicles were also on display for the engineers
designed by committees – which they were—and kept Ford to evaluate. Having these vehicles available started as motivation
from achieving world-class levels of performance. to improve efforts to become more competitive, and ended up as
The B&SE team set out to change all that. The resulting change an invaluable source of pride as the products grew increasingly
in attitude had a very positive impact on inter-departmental exciting and competitive—evidence of what the team was
relationships, cross-functional team work, and had the additional accomplishing. Another added attraction of these events started
effect of giving the team more influence—far fewer “negotiations” in 2004 with the hiring of Alan Mulally. He demonstrated both
were required now that they were seen as a key enabler to his commitment to and the importance of this team by joining
delivering the exciting products you see on the road today. This every B&S E All-Hands Meetings to give his view of the business
in turn created pride and confidence in the group—this operating and answer questions since he arrived at Ford—a practice he
attitude, while much more challenging in some respects than the continues to the time of this writing.
old one of just rejecting unfamiliar or difficult tasks was far more They organized around value streams. Cross-functional
gratifying. In fact this new level of pride resulted in widespread feuding was destroying product development effectiveness.
ownership of the initiative and drove organic change that was Information was tossed over walls like hand grenades and
fundamental to success. As GPDS progressed from the first two emails flew like scud missiles. They knew they had to create
years of learning from Mazda to a more advanced state by year aligned objectives and better teamwork. They did this in stages.
five, there was a shift from emulating benchmarked techniques to It began with North American stamping engineering and tool
developing unique and powerful enabling actions that surpassed manufacturing. Within two years it expanded to N.A. Body

Exterior Engineering, and a year later the organization was made process and then synchronizing the flow of steps to create just-in-
global. This turned out to be a marvelous migration process. time knowledge flow.
Each step was a major challenge, but the organization could The teams also found many opportunities in which they could
build on success from the earlier stage. As more and more of work simultaneously for longer periods and delay key decisions
the organization was added to the lean transformation process, until points in the process that were closer to the customer—
more of the vision and leadership had to come from the global with more accurate data. We discussed this earlier as set-based
VP to drive the change. For example, the shift to common vehicle concurrent engineering (Ward et al., 1995). A key enabler for set-
architectures and global platforms had to be led at the VP level. based engineering was Quality of Event Criteria (QECs) to ensure
Supplier relationships moved toward partnerships. Sad to the quality of the data/information/work required and measured
say, but Ford often treated suppliers like the enemy; yet Ford and at each milestone in the development process.
the suppliers had a common destiny (Liker and Choi, 2004). They They held regular TGW (Things Gone Wrong) meetings
knew they had to improve this situation. A key to progressing between die makers and stamping engineering. This not
toward supplier partnerships was a process of dialogues between only caught errors in design/engineering and provided
matched pairs of Ford engineers and buyers in purchasing opportunities to improve both process and standards, but was
who were responsible for the commercial side of working with also an important organizational tool. These meetings started
suppliers. In this process engineering and purchasing worked out very difficult with both engineering and the die makers
together to create part-by-part plans to improve quality, cost, being defensive and even aggressive at times; however, in the
and sourcing footprints. Based on these plans, and supplier end, this dramatically strengthened the relationship and cross-
performance/technical capability, the best suppliers were understanding of these groups. For each of the things gone
identified, cost models were developed jointly, and plans were wrong, they developed countermeasures both for interim
jointly executed. This also included regular supplier engagement containment and as a permanent corrective action, i.e., design
events and technology reviews. This was later extended to work rules, process changes, and critical characteristics. This then
cross-functionally on quality as well. evolved into joint agreements on standards to be followed in die
and stamping engineering.
Process Transformations They held ongoing process dialogues with other organizations
B&SE mapping and benchmarking revealed a wasteful, both within and outside of Ford, including suppliers in order to
uncompetitive development process. There was no denying get certain processes and expected outcomes aligned. They had
the data—especially when the technical experts returned from many supplier meetings (both large and small) and opened the
the Mazda benchmarking trips to confirm what the initial fact obeya in the tool shop for visits by suppliers which led to hearty
finding had shown. They had to find ways to not only make discussions. Through this process some suppliers deselected,
initial improvements, but to maintain those improvements while others failed, and several (located around the globe) became
managing the process and building in continuous improvement/ partners/enablers of Ford in the lean transformation. Intensive
learning mechanisms in order to have a truly world-class involvement of the purchasing department was also critical to
development process. this process.
They created process overview maps at a medium level (next They established Global Design Reviews led by the
level under GPDS)—process comparison maps of current state global functional chiefs. These were detailed, rigorous design
processes and “ideal state” (including gaps to ideal state) were evaluations/presentations conducted with the very best technical
developed for each major development step. At each of these experts from the global team in order to make sure that the latest
states, they showed a list of strategic enablers (people/process/ standards were met, lessons learned were incorporated, and test
technology improvements) identified to improve that step based criteria were passed. These were perhaps the most important
on initial benchmarking information. All enablers were then learning events and are fundamental to organizational learning
assigned to the initiative teams discussed above. and continuous improvement.
They held value-stream mapping events. Value-stream Ford also built in reflection events at critical program
mapping in product development is especially useful for enabling milestones in order to learn by reflecting on performance by
cross-functional and external organization dialogues. Some of the specific program milestones. They did not wait until the end
biggest opportunities surfaced from these events. In fact, so many of the program when much of the knowledge and information
ideas were generated by these events that the teams had to develop might be lost/confused. These in-process reflection events are
a decision matrix in order to prioritize opportunities. Priorities cross-functional and have the added advantage that they enable
were set and agreed by listing ideas on a four-quadrant graph real-time course corrections in addition to cross-program,
with degree of leverage/potential improvement possibility on the process improvement opportunities. To be successful these events
Y axis, and degree of difficulty/cost on the X axis. Those ideas require a significant level of organizational maturity to create a
with the most potential payoff and lowest cost were prioritized. non-punitive environment where participants have a learning/
These sessions were also key for identifying interdependencies continuous improvement mind set. The outcome of these events
and understanding exactly what information was required by is agreement to develop focused countermeasures in order to
each functional organization – including feedback loops. These improve specific parts of the process. Each opportunity has a lead
sessions were great for identifying waste of rework and instances assigned and date when the team or some part of it will regroup
where functional groups were actually doing too much work to review countermeasures. Finally the process improvements go
(finalizing designs) too soon. to the GPDS Steering Committee for final approval and become a
One of the key challenges for a large complex system design permanent part of the next GPDS release.
like cars is properly specifying interfaces of the various subsystems. Ford incorporated functional build, known at Ford as the
The new mantra became “compatibility before completion.” They PCF (Part Coordination Fixture) process, that takes a systems
also focused on moving as much as they could to the front of the approach to designing and building vehicle bodies (Hammett

et al., 1995). In the traditional process, the body engineers for above Ford conducts regular reflection events, TGW meetings,
each component expect their component to be built to their utilizes lessons learned, and creates countermeasure plans. Simple
specifications. This leads to a great deal of rework on individual A3 reports (one side of one sheet of paper) are used to represent
dies to make each part perfect. The functional build process allows the problem solving process. By showing only the most critical
for some variation on individual parts, but focuses on the overall information on one piece of paper, the key thought processes of
body meeting the design intent. This “part matching” process engineers can be tracked, and this provides an opportunity to get
allows engineers to make decisions based on system optimization critical input from others (Shook, 2008).
and address critical interface challenges. This process has been As the process matures it moves to a prevention stage.
proven to reduce total costs and improve overall product quality Global design reviews, basic engineering disciplines like failure
simultaneously—and this has certainly been the case at Ford. modes and effects analysis, check lists, design rules, digital pre-
Very early in the change process they discovered that a great deal assembly events, and simulations ensure that future programs
of the rework waste and quality issues were driven by an incredible comply with all the best standards and requirements for quality
array of differing designs, processes, and component requirements and performance. The latest digital technologies allowed them
that seemed to be unique to every program. The effort to standardize to embed this knowledge into parametric digital part templates.
was particularly enabled by the new global organization structure. This can be compared to genetic engineering to build quality and
The team standardized the development process, architectures, productivity into the very DNA of the product designs. These
individual parts, and manufacturing processes. templates embody the very best/latest standards, specifications,
They created Perfect Drawing Plans (PDPs) which are design rules, and manufacturing and quality requirements,
individual part development plans for every component to be and may be efficiently modified by engineers to fit unique
certain that they supported the overall development strategy design requirements without compromising quality. Standard
with quality. These plans take the parts from concept through architecture and the array of associated digital tools are very
engineering, manufacturing engineering, tools, and product impressive; however, they are only as good as the knowledge that
launch. These define quality of event criteria, design, test, tooling supports them. The templates are an outcome of the architecture
time lines, and critical inputs/outputs for these individual parts strategy which in turn depends on having detailed standards to
at critical points in time. These are fundamental to delivering achieve high levels of fit and finish.
the overall vehicle product time line and allowed engineering to The relationship between these processes is illustrated in
“know where they were” at any point in time. Tied to this were the Exhibit 2. Foundation engineering disciplines enable standard
tooling plans that mapped out requirements for each piece of each architectures and standard components that are the basis for
die as it goes through the internal tooling manufacturing process. common vehicle platforms. At the same time, body styles must,
Process Driven Product Design (PDPD) was a standard from the customer’s point of view, differentiate the vehicles. As
manufacturing process developed for each part that would guarantee an example, the 2010 Ford Explorer and Ford Taurus are on the
parts would be manufactured with world-class quality and efficiency same vehicle underbody even though they look like completely
and become a fundamental part of the design architecture. different vehicles to the customer. Many items that do not
They created a standard architecture that embodied the differentiate the car from the customer’s point of view are now
latest knowledge, and simultaneously allowed maximum standardized. For example, in the past Ford had many different
flexibility in design. We think that it might be helpful to utilize door hinges and now has reduced that number by more than
medical analogies to describe the role of Ford’s standard design 95%. Additionally, they have moved from unique hood inner
architecture strategy. The rigorous evaluation of the vehicle body architectures for each vehicle to just a single, morphable
and learning that takes place is like an autopsy. As mentioned architecture across all models.
Exhibit 2. Ford Integrated Body Exterior Strategy
Differentiate
Vehicles
Common
Platforms
Standard Subsystem and Component Architecture
Foundation Engineering Disciplines

(Advanced Quality Planning Design Rules, Check Lists, Health Checks, CAD/CAE Templates)

Technology and Tool Transformations value stream. The tool shop starts solids die designs created from
Developing today’s incredibly complex vehicles would be the original 3D design data with every detail of the die contained.
nearly impossible without a suite of sophisticated digital tools; The die Construction, Planning and Analysis team evaluates the
however, the quality of the knowledge and the engineer’s ability design and plans/schedules the manufacturing of every detail
to apply it at the right time is still the most important element no matter where in the world it will be built. Precise, high-speed
of lean product development. The team realized that before they mills machine surfaces within microns eliminating all of the
could fully leverage the capability of digital tools, they had to handwork that used to be required in machining and assembling
be certain that they fit and supported the people and process, dies. Sophisticated viewing software allows Dearborn Tool and
and that critical knowledge was validated, up to date, and that Die technicians to “see” details real-time as they are machined
basic engineering disciplines were in place. They then had to be whether the details are in Dearborn, Cologne, or Tianjin. Hourly
sure that the information was available to body and stamping UAW-represented technicians use and program much of the
engineers worldwide. technology.
Foundational knowledge is the fundamental information Standardized software, machine processes, and incredibly
required to design, engineer, tool up, and manufacture parts, accurate/detailed die designs allow Ford the option to source
sub-assemblies, and whole vehicles (see Exhibit 2). This includes machining of die components across the planet, bring them
performance specifications, test requirements, design rules, together, and have them fit precisely together. The precise
manufacturing requirements, and quality standards for thousands machining and effectiveness of engineering simulation programs
of components and their resulting interfaces. Much of this have allowed Ford to eliminate much of the press “tryout” (hand
information is contained in living documents that are updated grinding by skilled die makers) that used to go on for months.
based on organizational learning, changes in governmental New technologies and processes have allowed the team to get a
requirements, or new technological developments. The challenge “first part to gauge” within at most just a few days and often in
is to keep this information current, valid, and accessible. The B&SE just a matter of hours. Finally, white light or 3D optical scanning
leadership team quickly realized that revitalizing this invaluable allows technicians to scan dies, parts, or sub-assemblies in point
knowledge was key to improving the development process, dense, digital medium that can be analyzed, compared back to
coordinating global engineering activities, providing a foundation design all in its original solids environment. This has proven to
for improvement, and developing new engineers. Technical be an invaluable learning and problem solving tool and has also
specialists and experienced engineers spent months working allowed Ford to “finger print” dies before leaving the tool shop so
through this data, concurring globally, and validating in design that any part of the die, or the entire die can be replicated, either
review by functional chief engineers. This information is now for “dual tooling” or for replacing damaged dies/components.
captured in easy to use databases, check lists, virtual simulations, Developing “physicals-based” cost models was very
and embedded in parametric engineering templates—all of important to improving development efficiency and supplier
which are available to engineers around the globe. Furthermore, relationships. Ford engineers and purchasing managers worked
several mechanisms have been built into the process to be certain with suppliers to understand the design, process and logistical
that new knowledge is validated and captured so that repositories cost drivers for components and how they can work together to
remain up-to-date and accurate. lower costs without cutting into margins. In other words, these
The digital value stream extends from the design studio, cost models leverage data, knowledge, and collaboration instead
through engineering, to the tool manufacturing plant and of negotiation to arrive at the best possible component costs. Once
machining centers around the world. The virtual and digital tools these models are established and agreed on, it saves a great deal
available to designers and engineers would have been considered of time and money, and most often arrives at a lower total cost
science fiction just a few years earlier. In the design studio where for Ford and does not damage the supplier-customer relationship
artistic styling is done, ten foot power walls show virtual models the way traditional negotiations can. The result is that Ford’s costs
with incredible levels of detail. Every element of the design can have gone down while their supplier ratings have gone up.
be evaluated, quickly modified, and reevaluated. This includes Synchronizing the development value stream becomes ultra-
virtual craftsmanship reviews where everything from headlamp critical when thousands of interdependent activities are taking
appearance, to class one surface reflectivity, and fit and finish place simultaneously in multiple locations around the world.
can be scrutinized at an exacting level of precision and detail. The team has merged previously disparate scheduling tools into
Once approved, three-dimensional surfaces are released directly a single, integrated, detailed status view allowing the team to
from the design model into the 3D engineering databases and review status to schedule in a holistic way. As mentioned above
tool sets. Body Engineers use this data to finish their detailed sophisticated viewing software actually lets the team “see” status
component engineering utilizing parametric templates, conduct regardless of where the work is taking place.
simulation/testing critical performance attributes, check critical The value stream mapping work done by the team allows
attributes like weight, and optimize efficient material utilization them to understand the most critical points in the development,
—all before the designs are ever released. Simultaneously, the and the process plans show how each step in the development
stamping engineers use the same data as the body engineers to of every component and sub-assembly fits into the overall
run forming simulations, start detailed die designs, machining/ development plan. Equipped with this knowledge and a handful
milling verifications, die interference checks, further optimize of unique tools, the thousands of steps in the development process
material utilization, and finally, run press simulations based on are far better coordinated and monitored—no matter where they
the actually press lines the tools will eventually be run in. are taking place.
At Dearborn Tool and Die (Ford’s in house tool shop), digital Health charts (status on quality key points like door closing
technologies and lean processes have allowed them to move from effort) and quality targets helped drive design, process, and content
the old craft based (“black magic”) model of tool and die making solutions into new programs to ensure year-over-year quality
to a lean, high precision, machine-intensive end of the digital improvements that are best in industry. Specific requirements

for component design, manufacturing process, component with a set of lean PD principles derived from extensive studies
attributes, and manufacturing plant operating requirements are of Toyota’s and Mazda’s product development processes. Given
captured under a large number of categories like craftsmanship, the shortage of well documented lean PD transformations, there
class-one surface requirements, dimensional control, or material were many questions as to whether or not an existing product
handling that are checked at specific points in the development development program, with a long-standing tradition, could
process to be certain all elements of all components, as well as be transformed based on these principles to become a high-
the overall body, are ready for a high quality launch. These health performing organization. The results suggest it is possible to
charts have contributed to a dramatic reduction in launch quality make major improvements in results based on major changes in
issues and costly re-work. people, processes, and tools.
One powerful tool is the obeya process (Morgan and Liker, The systems model for lean product development was based
2006). Making problems visible to the team is the key to real-time on intensive study of Toyota and Mazda. In Toyota’s case the study
problem solving and also maintains the cadence of the product led to a set of 13 principles that guided the vision for the future
development process. state. Mazda, which had a technology sharing agreement with
Toyota and shared all of the 13 principles, acted as a source of
Results detailed benchmarking at the operational and tools level. Through
The improvements at Ford in this critical element of automotive gap analysis of people, process, and tools as well as results,
product development over five years of this transformation cross-functional teams could get a detailed picture of specific
process—2004 to 2009—have surpassed benchmarked levels of opportunities for improvement at Ford. Mazda also was a key
performance for quality, lead time, and cost. Over the past five source of inspiration to win people over. They could see in high
years they reduced average overall lead time by 40% (nearly 50% resolution the difference in methods and processes, and superior
reduction in one all-new car body), and reduced internal tool and performance. This level of technical detail was also important to
die construction timing by an average of 50%. For example the winning the support of the engineering teams who built on this
average time it takes from body styling to design and build the dies information to create their own, even better processes
that stamp out the body and get them into production was reduced We would definitely not describe the Ford journey as an
by 50%. During the same time period, they reduced internal tool attempt to copy Toyota. Far from it—Ford has its own culture,
investment costs by an average of 45% and decreased average labor unique strengths, and its starting point was very different from
hours per tool by more than 50%. Die cost is related to the number Toyota’s. On the other hand, we can say that Ford stayed true
of different stamping hits required to make the body part; that has to the lean product development principles that were derived
gone from 6-7 hits per part to 3-4 hits. In the Ford Dearborn Tool from the study of Toyota. We believe these principles are generic
and Die plant, the largest source of production dies, the number enough to apply broadly to product-process development across
of people making dies was cut in half while output of dies doubled companies and industries.
yielding a 400% increase in productivity. It would be unreasonable to attempt to generalize from a
Most importantly they have simultaneously improved quality single case on the one best way to transform an organization to
by more than 35% as measured by things gone wrong for the lean product development. Ford is a unique organization and in the
body sub-system, and increased dimensional accuracy by 30% period from 2005 to 2010 faced unique circumstances including
including dramatically improved craftsmanship and body fit and near bankruptcy. The opportunity for microscopic benchmarking
finish that is now among the very best in the world. On measures of Mazda is an opportunity few organizations have. It certainly
of things gone wrong in the vehicle body by J.D. Power, Ford went helped that Ford is similar enough to Toyota in product and process
from the worst of any automaker in 2003 to the best in 2008. In to be able to learn directly some of the best practices. Nonetheless,
fact, body exterior was the most improved element in a recent we do believe there are some lessons from Ford that are worth
quality report card. considering by other companies attempting the journey.
Finally, morale as measured by Ford’s annual internal As we look back at the Ford case, it is clear that lean product
survey also improved by about 30% during this same time development is far more than a toolkit to eliminate waste. In fact,
period. Engineers fed off early successes, took ownership of stepping back we see the transformation at Ford as beginning at a
the initiative, and developed unique, powerful innovations that global level with the strategy of the company. Had Ford not used
allowed Ford to surpass their benchmarks in many key areas. As the funding obtained by “betting the company” on a product-led
mentioned earlier, enrolling the talented engineers was crucial. re-vitalization, lean product development would never have been
It is also important to note that all of these improvements were possible. This strategic commitment by the CEO of the company
accomplished with relatively little investment and during a period led to a focus on product development that was unprecedented
of severe downsizing. at Ford. Together they followed to a large extent the model of a
systems approach to lean product development—global platforms,
Conclusions standardized parts, front-loaded design, and accountable, highly
Lean product development is a relatively new field of study and skilled and empowered engineers. Lean processes then enabled this
there are different perspectives on what it is. Under experienced, strategy, with the energized engineers, to achieve record product
knowledgeable leadership Ford began their transformation launches and ultimately success in the marketplace (see Exhibit 3).
Exhibit 3. From Strategy to Lean Processes to Market Success
Strategy & Aligned & Global Driven

Focus Accountable Platform, Lean Market
Accountable
for Products Global Standardization Processes Success
Team Members
Excellence Leadership Strategy

There are a number of important lessons to be learned from the change, it felt like a hopeless struggle. Leadership is
this case: much more than managing to a linear plan. Leadership
1. Lean processes can be effective in driving high quality, low requires a wide range of skills including reading political
cost, and short lead times in product development. A lean situations, understanding the culture, building relationships,
process is driven by continuous improvement to eliminate understanding mass psychology, penetrating the psychology
waste, which surfaces problems, reducing the time from of individuals, and in the end winning over the mass of
problem to solution. The basic principle is to shorten the engineers to work toward the vision. It is messy, frustrating,
loops of plan-do-check-act as much as possible. Over time, elating, and a leader must never, ever let up. Particularly in
as the organization matures, it can pull that knowledge up the early stages much of the leadership was brutal and top
front, front-end loading, and head off accumulated batches down. Lean implementation is a leadership process, not a
of problems down stream. Value-stream mapping is one technical process.
tool to allow cross-functional teams to see the waste in the
current process and develop plans for reducing waste in the The original meaning of the term “lean” was to represent a
next design cycle. It is part of the “plan” of PDCA. At the end genuine paradigm shift in how to manage a complex organization
of the design cycle, there should be a major reflection with (Krafcik, 1988). A lean organization is robust, flexible, and healthy,
further action to complete the big PDCA loop. This should just like a lean body. The last step in Womack and Jone’s (1996) Lean
then lead into the plan for the next design program. Thinking is “striving for perfection.” Continuing the motivation
2. The transformation requires a long-term commitment and a for improvement beyond the initial transformation drive may be
staging of the transformation process. In the case of Ford, the a greater leadership challenge then managing the change. People
starting point was an overall transformation model applied and the organization naturally settle into patterns, and when they
to pieces of the development process in pilots. Those who feel they have been successful there is a tendency for complacency
led the pilots and learned from them were then transferred to set in. Failure to improve in lean means entropy will drive you
into the operational unit to lead from within. Over time the toward decline. Is “lean” the best choice of words? Not necessarily.
process was spread, tools were added, organizational changes One could substitute product development excellence for lean
were made, and progress accelerated. product development. Lean product development is striving for
3. Driven, accountable team members transform lean product excellence—on an individual level and on an organizational level
development from static tools to a living high-performance —and the journey never ends.
system. Ford tried lean engineering years earlier and
eventually amassed a major bureaucracy maintaining a Future Research
monstrous phase-gate process that nobody even seemed There are a number of characteristics of lean product development,
to be able to understand let alone follow. At some point as we have defined it, that make it challenging to research:
the tools took on a life of their own and had no relation to 1. Lean as an emergent system. If we are correct that in order
what working-level engineers did in the actual development to be highly effective lean product development requires
process. The more recent success at Ford was due to a greatly the integration of people, processes, and tools, then it will
simplified tool set that was actually used throughout the not be possible to test hypotheses about the effectiveness
body engineering organization. It took years of patient and of individual “best practices.” The typical linear regression
deliberate leadership to get the engineering organization model assumed independent, additive contributions of
aligned. The benefit of the crisis of Ford’s near bankruptcy to individual variables, whereas a system’s view assumes
create a “burning platform” cannot be overstated. complex interactions between variables. A reductionist view
4. The main role of lean tools is to make problems visible and of system features in isolation will violate the integrity of the
provide a method of solving them at the root cause. Some of system and lead to misleading conclusions.
the most useful tools were very simple. The obeya process of 2. Lean as a dynamic evolving process. If we view lean as a
visual management caused cross-functional teams to quickly process that develops over time, then measurements at a slice
see problems and write them down. Putting an actual person’s in time simply represent one stop on the journey. We do not
name and an expected completion date drives accountability. know where the organization has come from or where it is
The whole team knows in the next meeting when someone has going to from this one data point.
let them down. Peer pressure is a powerful motivator. The A3 3. Lean as an evolving culture. If a criterion for success is the
process of problem solving makes the thinking process clear depth and breadth of engraining lean thinking in the culture,
and visible, which provides an opportunity for checking and then we cannot judge how lean an organization is based
coaching by informed leaders (Shook, 2008). Engineering only on the structure of the development process. We must
checklists make decision criteria visible and deviations come actually measure and capture the culture and way of thinking
to light immediately. Many of the specific lean tools applied, and acting of engineers.
e.g., health charts, were used to set challenging stretch targets
that drove teamwork and innovation (Rother, 2009). These characteristics suggest that conventional, cross-
5. Lean implementation is a social, cultural, and political sectional surveys that look at collections of best practices as
transformation. We have described the transformation of independent variables predicting outcomes will not be effective
Ford in an admittedly simplistic way. The period of time we in the case of lean product development. Greater insight can be
are talking about was one of great turmoil. Ford was fighting gained by in-depth cases studied over time. It also suggests that
for its survival. There were many very painful layoffs. There it will not be useful to pose research questions in deterministic
were many managers and engineers who resisted change and form such as: If we do these things we will get these results. In
had to be won over, or in some cases given an ultimatum reality different organizations can do “these things” and get very
to get on board or leave. At times, for those living through different results depending on where they are in the process, what

they learn from the things they do, how doing these things shapes way” conundrum. Assuming there is an optimum approach or
the way of thinking of engineers, and the leadership approach one best way to implement a tool is antithetical to the continuous
when doing these things. improvement underpinnings of lean thinking. As we continue
What then can be useful research questions? We believe for to learn about lean product development, we have to accept that
the specific case of lean product development, the most valuable all answers are provisional and there is always a better way that
methodology is action research that elucidates ways to approach someone will discover. In this spirit, collaborative research to
key issues such as: build on ideas is preferred. The Ford case gives us one approach
1. Culture change. How can we facilitate a change in thinking that stays true to the Toyota model and strong evidence that
from finding and fixing problems to designing in quality lean product development can be a powerful way to significantly
based on PDCA? At Ford, we observed a change in the way improve business performance.
engineers thought about problems. In the past the focus was
on reacting to issues as they were discovered which was often References
late in the development process or even after production Adler, Paul S., “Building Better Bureaucracies,” Academy of
launch. After several years of lean development, working- Management Executive, 13:4 (November 1999), pp. 36-47.
level engineers would ask challenging questions like: “Do we Clark, Kim B., and Takahiro Fujimoto, Product Development
really understand what the problem is?” and “Do we know Performance: Strategy, Organization and Management in the
the root cause?” Research might document these shifts in World Auto Industry, Harvard Business Press (1991).
language through anthropological methods and develop Deming, W. Edwards, Out of the Crisis, MIT Press (1986).
interventions to facilitate cultural transformation. Hammett, Patrick C., Walton M. Hancock, and Jay S. Baron,
2. Standardization and innovation. These are often seen as “Producing a World-Class Automotive Body,” from J.K.
opposites but in lean we see these as two sides of the same Liker, J.E. Ettlie, and J.C. Campbell (eds.) Engineered in
coin. Adler (1999) made an important distinction between Japan, Oxford University Press (1995).
coercive bureaucracy that treats standards as something Kamath, Rajan, and Jeffrey K. Liker, “A Second Look at Japanese
to monitor and enforce with rewards and punishments, Product Development,” Harvard Business Review, Nov.-Dec.
and enabling bureaucracy that treats standards as today’s 1994, pp. 154-173.
best known solution upon which we want to build and Kennedy, Michael N., Product Development for the Lean Enterprise:
make improvements. More research is needed to build on Why Toyota’s System is Four Times More Productive and How
this distinction and help understand how we can facilitate You Can Implement It, Oklea Press (2008).
standardization as part of enabling bureaucracy to encourage Kennedy, Michael N., Kent Harmon, and Ed Minnock, Ready, Set,
innovation. Dominate: Implement Toyota’s Set-Based Learning for Developing
3. Front-end loading and innovation. As companies apply Products and Nobody Can Catch You, Oklea Press (2008).
lean methods and begin to shift from reacting to problems Kotnour, T., and R. Landaeta, “EMJ Author Guidance: Writing
downstream to designing in solutions in the “fuzzy front end” Reflective Case Studies for the Engineering Management
of the process, there is an opportunity to make intelligent Journal (EMJ),” Proceedings of the 25th Annual Meeting of the
decisions about where to introduce new product technologies American Society for Engineering Management, (October 20-
and when it is more effective to standardize designs. Research 23, 2004).
can assist in this thinking process to better understand the Krafcik, John F., “Triumph of the Lean Production System,” Sloan
tradeoffs between new technology and standard parts and Management Review, 20:1 (Fall 1988), pp. 41-52.
architectures. Ladas, Corey, Scrumban: Essays on Kanban Systems for Lean
4. Use of requirements engineering. The starting point for Software Development, Modus Cooperandi Press (2009).
defining waste is defining customer value, and we have seen a Lander, Eduardo, and Jeffrey K. Liker, “The Toyota Production
weakness in the way firms establish targets to meet customer System and Art: Making Highly Customized and Creative
requirements. The first house of quality in quality function Products the Toyota Way,” International Journal of Production
deployment is a starting point, but lean firms go much farther Research (2007).
in detailing requirements at the subsystem and component Liker, Jeffrey K., The Toyota Way: Fourteen Management Secrets
level, and holding teams accountable for delivering on targets from the World’s Greatest Manufacturer, McGraw-Hill (2004).
they helped develop. Research is needed to better understand Liker, Jeffrey K., and Thomas Choi, “Building Deep Supplier
the target-setting process at the level of detail required. Relationships,” Harvard Business Review, (December, 2004),
5. Use of obeya. We have found that the obeya is one of the most pp. 104-113.
powerful lean tools. The power is in visual communication Liker, Jeffrey K., and Michael Hoseus, Toyota Culture, McGraw-
and accountability of functions to work together toward Hill (2008).
cross-functional objectives. There is a lot of variation in Liker, Jeffrey K., Durward Sobek, Allen C. Ward, and John
how obeya is used and many questions about its use in other Cristiano, “Involving Suppliers in Product Development
companies. What information should be posted and how in the U.S. and Japan: Evidence for Set-Based Concurrent
should it be used? How can we use the obeya for virtual Engineering,” IEEE Transactions on Engineering Management,
teams? Is a computer representation as effective as printed 43:2 (1996), pp. 165-177.
out and posted representations? Are there opportunities for Morgan, James M., High Performance Product Development: A
computer-group support systems? There are tremendous Systems Approach to a Lean Product Development Process,
opportunities for research on the obeya alone. The University of Michigan (2002).
Morgan, James M., and Jeffrey K. Liker, The Toyota Product
One of the challenges of research on lean product development Development System: Integrating People, Process, and
is discovering useful information, while avoiding the “one best Technology, Productivity Press (2006).

Reinertsen, Donald G., The Principles of Product Development Young Ro, Jeffrey K. Liker, and Sebastian Fixson, “Modularity as
Flow: Second Generation Lean Product Development, Celeritas a Strategy for Supply Chain Coordination: The Case of U.S.
Publishing (2009). Auto,” IEEE Transactions on Engineering Management, 4:1
Ro, Young, Jeffrey K. Liker, and Sebastian Fixson, “Modularity as (Feb. 2007), pp. 172-189.
a Strategy for Supply-Chain Coordination: The Case of U.S.
Auto,” IEEE Transactions on Engineering Management, 54:1
(February 2007), pp 172-189. About the Authors
Rother, Mike, Toyota Kata, Managing People for Improvement, Dr. Jeffrey K. Liker is Professor of Industrial and Operations
Adaptiveness, and Superior Results, McGraw Hill (2009). Engineering at the University of Michigan. He is author of
Shook, John, Managing to Learn, Lean Enterprise Institute the international best seller, “The Toyota Way,” McGraw Hill,
(2008). 2004 and (with David Meier) “The Toyota Way Fieldbook,”
Sobek, Durward, Allen C. Ward, and Jeffrey Liker, “Another Look McGraw Hill (2005). This article is based on his book with
at How Toyota Integrates Product Development,” Harvard Jim Morgan, “The Toyota Product Development System,”
Business Review, 76:4 (July-Aug.,1998), pp. 36-50. Productivity Press (2006). His articles and books have won
Wasti, Nazli, and Jeffrey K. Liker, “Collaborating with Suppliers eight Shingo Prizes for Research Excellence.
in Product Development: A U.S. and Japan Comparative Dr. James Morgan is Director, Global Body Exterior
Study,” IEEE Transactions on Engineering Management, 46:4 and Stamping Business Unit Engineering, Ford Motor
(1999), pp. 441-461. Company. He has more than 20 years of Engineering and
Ward, Allen C., Jeffrey Liker, Durward Sobek, and John Cristiano, Operations Management experience, including as Vice
“The Second Toyota Paradox: How Delaying Decisions Can President, Troy Design and Manufacturing Company before
Make Better Cars Faster,” Sloan Management Review (Spring joining Ford in 2004. He co-authored the book “The Toyota
1995), pp. 43-61. Product Development System” based on his Shingo Prize
Ward, Allen C., Lean Product and Process Development, Lean winning doctoral research in engineering at the University
Enterprise Institute (2007). of Michigan.
Womack, James P., and Daniel T. Jones, The Machine that Changed Contact: Dr. Jeffrey Liker, Professor, Industrial
the World: The Story of Lean Production, Harper Perennial Engineering, University of Michigan, 1205 Beal Ave., Ann
(2001). Arbor, MI 48109; phone: 734-763-0166; [email protected]
Womack, James P., and Daniel T. Jones, Lean Thinking: Banish
Waste and Create Wealth in Your Corporation, Simon &
Schuster (1996).
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Lean Product Development as a System: A Case Study of Body and Stamping

Article in Engineering Management Journal · April 2015

The user has requested enhancement of the downloaded file.

Refereed research manuscript. Accepted by Special Issue Editor Geert Letens.

16 Engineering Management Journal Vol. 23 No. 1 March 2011

Exhibit 1. The Thirteen Principles of the Toyota Product Development System*

6. Organize to balance Functional Expertise and Communication.

Cross-functional Integration. 13. Use Powerful Tools for Standardization and

7. Develop Towering Technical Competence in all Organizational Learning.

8. Fully Integrate Suppliers into the Product

Development System. development

9. Build in Learning and Continuous Improvement. system

10. Build a Culture to Support Excellence and

1. Establish customer-defined value to separate value added from waste.

Engineering Management Journal Vol. 23 No. 1 March 2011 17

18 Engineering Management Journal Vol. 23 No. 1 March 2011

Engineering Management Journal Vol. 23 No. 1 March 2011 19

20 Engineering Management Journal Vol. 23 No. 1 March 2011

Engineering Management Journal Vol. 23 No. 1 March 2011 21

22 Engineering Management Journal Vol. 23 No. 1 March 2011

Exhibit 2. Ford Integrated Body Exterior Strategy

Standard Subsystem and Component Architecture

Foundation Engineering Disciplines

Engineering Management Journal Vol. 23 No. 1 March 2011 23

24 Engineering Management Journal Vol. 23 No. 1 March 2011

Exhibit 3. From Strategy to Lean Processes to Market Success

Strategy & Aligned & Global Driven

Engineering Management Journal Vol. 23 No. 1 March 2011 25

26 Engineering Management Journal Vol. 23 No. 1 March 2011

Engineering Management Journal Vol. 23 No. 1 March 2011 27

28 Engineering Management Journal Vol. 23 No. 1 March 2011

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