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 Discover Excellence
An Overview of the Shingo Model
and Its Guiding Principles
    
 Discover Excellence
An Overview of the Shingo Model
and Its Guiding Principles

Edited by
Gerhard Plenert
Former Director of Executive Education
Shingo Institute
CRC Press
Taylor & Francis Group
6000 Broken Sound Parkway NW, Suite 300
Boca Raton, FL 33487-2742

© 2018 by Utah State University

CRC Press is an imprint of Taylor & Francis Group, an Informa business

No claim to original U.S. Government works

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 To the love of my life—Renee Sangray Plenert

Where I discovered excellence!!!

And to the Shingo Institute—which strives for a world of excellence

Gerhard Plenert
Contents
Preface.....................................................................................................xi
Acknowledgments................................................................................. xv

Chapter 1 Introduction........................................................................ 1
Discover Excellence Workshop..................................................3
Cultural Enablers Workshop......................................................4
Continuous Improvement Workshop.......................................5
Enterprise Alignment & Results Workshop.............................5
Build Excellence Workshop........................................................6
Definition of Lean........................................................................7

Section I  Overview of the Shingo Model

Chapter 2 Why Are We Here?............................................................ 11
How to Define Enterprise Excellence?.....................................11
A Little History...........................................................................17
The Shingo Prize.........................................................................18
The Shingo Institute...................................................................21
Driving Toward Enterprise Excellence....................................22
Discover Excellence....................................................................25

Chapter 3 Defining Behavior............................................................. 27

Why Do Enterprises Exist?.......................................................27
Defining Behavior?.....................................................................31
Continuing on the Journey to Enterprise Excellence?......... 34

Section II  Culture

Chapter 4 Characteristics of Culture................................................ 39
What Is Culture?........................................................................39
Who Creates the Culture?........................................................ 40
Bridging the Gap....................................................................... 42

vii
viii • Contents

Chapter 5 Three Insights of Enterprise Excellence.......................... 45

Insight..........................................................................................45
Insight #1: Ideal Results Require Ideal Behavior...............47
Insight #2: Purpose and Systems Drive Behavior............ 48
Insight #3: Principles Inform Ideal Behavior.....................51
The O.C. Tanner Story of How Principles Influence
Enterprise-Wide Behaviors.......................................................52
Recap............................................................................................53

Chapter 6 The Shingo Model............................................................. 55

The Shingo Model.......................................................................55
Dimensions..................................................................................57
The Principles..............................................................................58

Chapter 7 The Shingo Guiding Principles........................................ 61

The Shingo Guiding Principles.................................................61
Cultural Enablers Dimension...................................................62
Respect Every Individual......................................................65
Lead with Humility.............................................................. 66
Continuous Improvement Dimension....................................67
Seek Perfection.......................................................................69
Embrace Scientific Thinking................................................70
Focus on Process....................................................................70
Assure Quality at the Source...............................................71
Flow & Pull Value..................................................................71
Enterprise Alignment Dimension............................................72
Think Systemically................................................................73
Create Constancy of Purpose..............................................73
Results Dimension.....................................................................73
Create Value for the Customer............................................74
Review..........................................................................................75

Section III  Knowing Why

Chapter 8 Thought Leadership.......................................................... 79

Assessing Culture.......................................................................79
 Contents • ix

Knowing Why............................................................................ 84
Principles Inform Ideal Behaviors...........................................85

Chapter 9 New United Motor Manufacturing, Inc.: A Case

Study That Informs the Shingo Model............................ 89
The History..................................................................................89
The Workforce....................................................................... 90
Why Did Toyota and GM Agree to This Joint Venture?......91
The Principles in Action............................................................92
Cultural Enablers: Respect Every Individual.....................92
Cultural Enablers: Lead with Humility..............................95
Continuous Improvement: Seek Perfection...................... 96
Continuous Improvement: Embrace Scientific
Thinking.................................................................................98
Continuous Improvement: Focus on Process................. 100
Continuous Improvement: Assure Quality at the
Source....................................................................................101
Continuous Improvement: Flow & Pull Value................103
Enterprise Alignment: Think Systemically......................104
Enterprise Alignment: Create Constancy of Purpose...... 105
Results: Create Value for the Customer............................105
Lessons Learned.......................................................................106
Lesson #1: TPS, or Lean Manufacturing,
Works Anywhere in the World..........................................106
Lesson #2: Lean Tools and Systems Do Not Thrive
without the Right Culture..................................................107
Lesson #3: It Is Possible to Turn Around Any
Workforce by Applying These Principles.........................109
Conclusion.................................................................................110

Chapter 10 Go and Observe............................................................... 113

The Gemba Walk......................................................................113
Case Example and Exercise.....................................................118
Some Additional “Go and Observe” Tips.............................119
Summary.................................................................................. 120
Vale Clydach Refinery Case Study.........................................121
History: What’s the Story?................................................. 122
What Was the Need for Change?..................................... 123
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x • Contents

Enacted Solutions and the Results....................................125

Discussion Questions..........................................................129

Chapter 11 The Shingo Assessment Process..................................... 131

Assessment................................................................................131
The Shingo Prize as an Assessment Tool..............................133
Does “A Couple of Tools” Work Better?............................... 134
Impact/Effort Matrix......................................................... 134
A3 Problem-Solving Worksheet........................................136

Section IV Wrap Up

Chapter 12 Bringing It All Together................................................. 141

Shingo Prize Recipient.............................................................141
Recap..........................................................................................144
Appendix.............................................................................................. 147
Shingo Award Recipients.............................................................. 147
Recent Shingo Prize Recipient Profile Sheets............................. 166
Bibliography......................................................................................... 191
Index..................................................................................................... 193
About the Editor.................................................................................. 199
Preface
In a meeting with a CEO (chief executive officer), Dr. Gerhard Plenert was
told, “We have had dozens of consulting companies through here, each
telling us they know the best way to solve our enterprise’s performance
problems. But every one of them only solves a small part of the problem.
And what’s even more frustrating is that as soon as the consultant leaves,
the employees quickly revert back to their previous business practices. It’s
just been a big waste of money. Are you going to come in here and give me
another solution which fixes a part of our problem but leaves us missing
the mark? Are you going to give us another quick-fix wonder which only
offers a temporary solution?”
Dr. Plenert was quick to jump at the opportunity and stated, “What
you’re telling me is that all you’re getting is a bunch of tools. You’re not
attacking your problems at the correct level of your organization. You’re
not building a sustainable solution to your performance problems.”
“What do you mean?” asked the CEO.
“The good news is that you’ve already identified the problem,” Dr. Plenert
continued. “Your problem isn’t that the tools you’ve been given aren’t good
tools. It’s not that the tools aren’t working. The problem is that the tools
by themselves don’t offer sustainability. So the real question we should ask
is, ‘Why don’t these tools maintain the performance improvements that
they demonstrate on a temporary basis?’ A second problem is that each
solution temporarily fixes part of your performance problems. But none
of them fix all the problems.”
“So what you’re saying is that I need some kind of integrated solution,”
inserted the CEO. “I understand that. But how do I make it sustainable?”
“The only way to get sustainability is through an enterprise-wide cultural
shift. You currently have a culture that has been established through many
years of tradition. It’s ingrained into the company. They have a ‘this is how
it’s always been done’ attitude and they believe that tradition is the best way
to do things. They also have a ‘we’re different than anyone else’ attitude
which makes them resistant to change. They don’t believe anyone else truly
understands what they do and how they do it. They’re willing to play along
with the latest fad that comes down from the executive office, which is how

xi
xii • Preface

they regard the change initiatives that you’ve introduced, but as soon as the
change agent leaves the building, they revert back to tradition.”
“You’ve captured my interest and curiosity,” responded the CEO. “What
do you recommend?”
“Let me introduce you to the Shingo Institute (www.shingo.org). It’s an
organization affiliated with Utah State University. They host an interna-
tional award in enterprise excellence and they have a training program
associated with that award. This training will teach you how to shift the
behaviors within your organization so you can successfully transform
your enterprise-wide culture. The Institute teaches you how systems drive
behaviors, and how only through a shift in these behaviors will you ever
be able to achieve a culture that sustains a higher-level of performance.”
With that Dr. Plenert and the CEO proceeded to discuss the details of
the Shingo methodology (which is the subject of this book), and a series
of Discover Excellence workshops were scheduled for the leadership and
management of the organization. This was the first step toward achieving
enterprise excellence, and that is what this book will teach the reader how
to do.
But first, just for fun, one should look at how good an organization is at
solving problems. Below is a test created by Einstein. It’s called the Albert
Einstein Riddle. Albert Einstein wrote this riddle and claims that if a per-
son can solve this “pure logic” problem then that person must be in the top
2% of the intelligent people in the world. He starts with these rules:

1. On a street, there are five houses painted five different colors.

2. In each house lives a person of a different nationality.
3. Each of these five homeowners drink a different kind of beverage,
smoke different brands of cigars, and keep different pets.

The question the reader should try to answer is, “Who owns the fish?”

Einstein offers the following clues:

1. The Brit lives in the red house.

2. The Swede keeps dogs as pets.
3. The Dane drinks tea.
4. The green house is on the left of the white house.
5. The owner of the green house drinks coffee.
6. The person who smokes Pall Mall rears birds.
 Preface • xiii

7. The owner of the yellow house smokes Dunhill.

8. The man living in the center house drinks milk.
9. The Norwegian lives in the first house.
10. The man who smokes Blends lives next to the one who keeps cats.
11. The man who keeps horses lives next to the man who smokes Dunhill.
12. The man who smokes Blue Master drinks beer.
13. The German smokes Prince.
14. The Norwegian lives next to the blue house.
15. The man who smokes Blends has a neighbor who drinks water.

The answer to the riddle is found later in this book.

Acknowledgments
To give credit where credit is due, the Shingo Institute would need to cre-
ate a long list of individuals, companies, and universities that the Institute
has worked with through the years. The list is far too long to give everyone
credit, but the Shingo Institute needs to acknowledge a few specific indi-
viduals who were instrumental in the development of this book’s material.
Those most closely involved during their tenure at the Shingo Institute
were Shaun Barker, Max Brown, Randall Cook, Robert Miller, Gerhard
Plenert, and Jacob Raymer. The Shingo Institute is appreciative of their
contributions for without which the content of this book would not exist.
The Shingo Institute would also like to thank the members of the Shingo
Executive Advisory Board and affiliate organizations who provide prac-
tical insights and critical feedback. And a special thanks to the Jon M.
Huntsman School of Business at Utah State University for providing the
Institute with a home and an environment to learn, flourish, and grow.
Finally, the Shingo Institute thanks Gerhard Plenert for compiling this
book. Dr. Plenert has lived and worked in factories in North, Central, and
South America; Asia; the Middle East; and Europe. He has coauthored
articles and books and worked with academics and professionals from as
far away as Europe, Japan, and Australia. His experience has provided him
a broad exposure to a variety of manufacturing, service, government, and
military facilities all over the world.

xv
1
Introduction

Too many organizations are failing to be competitive, not because they

cannot solve problems, but because they cannot sustain the solution.
They haven’t realized that tradition supersedes tools, no matter how
good they are. Success requires a sustainable shift in behaviors and cul-
ture, and that needs to be driven by a shift in the systems that motivate
those behaviors.

Gerhard Plenert

Countless organizations have, at one time or another, begun a “Lean jour-

ney” (for a brief description of Lean, please see the end of this introduction)
or they have implemented an improvement initiative of some sort. At the
foundation of these initiatives are a number of tools that seem to promise
exciting new results. While many organizations may initially see significant
improvements, far too many of these initiatives meet disappointing ends.
Leaders quickly find that Lean tools such as Six Sigma, jidoka, SMED, 5S,
JIT, quality circles, etc. are not independently capable of effecting lasting
change.
Years ago, the Shingo Institute set out on an extended study to deter-
mine the difference between short-lived successes and sustainable results.
Over time, the Institute noticed a common theme: the difference between
successful and unsuccessful effort is centered on the ability of an organi-
zation to ingrain into its culture timeless and universal principles rather
than rely on the superficial implementation of tools and programs. These
findings are confirmed time and again by nearly three decades of assessing
organizational culture and performance as part of the Shingo Prize pro-
cess. Since 1988, Shingo examiners have witnessed first-hand how quickly
tool-based organizations decline in their ability to sustain results. On the
other hand, organizations that anchor their improvement initiatives to

1
2 • Discover Excellence

principles experience significantly different results. This is because prin-

ciples help people understand the “why” behind the “how” and the “what.”

To best illustrate these findings, the Shingo Institute developed the

Shingo Model™, the accompanying Shingo Guiding Principles, and the
Three Insights of Enterprise Excellence™. The Shingo Institute offers a
series of five workshops designed to help participants understand these
principles and insights and to help them strive for excellence within their
respective organizations. This book, Discover Excellence: An Overview of
the Shingo Model and Its Guiding Principles, is an introduction to these
five workshops.
 Introduction • 3

Here is a description of the first of five workshops offered in the Shingo

Institute educational series.

DISCOVER EXCELLENCE WORKSHOP

A facility-wide improvement initiative is expensive in terms of both time
and money. Perhaps the most disappointing thing about them is that they
often end up as temporary measures that may produce early results but are
unsustainable in the long run. The unseen cost is that after they see such
initiatives come and go, employees begin to see them as futile, tempo-
rary annoyances rather than the permanent improvements they are meant
to be.
The Shingo Model begins with culture informed by operational excel-
lence principles that lead to an understanding of what aligns systems and
tools and can set any organization on a path toward enterprise excellence
with sustainable continuous improvement.
The Shingo Model is not an additional program or another initiative to
implement. Instead, it introduces Shingo Guiding Principles on which to
anchor current initiatives. Ultimately, the Shingo Model informs a new
way of thinking that creates the capability to consistently deliver ideal
results to all stakeholders. This is enterprise excellence—the level of excel-
lence achieved by Shingo Prize recipients.
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4 • Discover Excellence

DISCOVER EXCELLENCE is a foundational, two-day workshop that

introduces the Shingo Model, the Shingo Guiding Principles, and the Three
Insights of Enterprise Excellence. With active discussions and on-site learn-
ing at a host organization, this program is a highly interactive experience.
It is designed to make learning meaningful and immediately applicable as
participants learn how to release the latent potential in an organization to
achieve enterprise excellence. It provides the basic understanding needed
in all Shingo workshops; therefore, it is a prerequisite to the CULTURAL
ENABLERS, CONTINUOUS IMPROVEMENT, and ENTERPRISE
ALIGNMENT & RESULTS workshops, and concludes with the BUILD
EXCELLENCE workshop.

DISCOVER participants will:

• Learn and understand the Shingo Model.

• Discover the Three Insights of Enterprise Excellence.
• Explore how the Shingo Guiding Principles inform ideal behaviors
that lead to sustainable results.
• Understand the behavioral assessment process using a case study
and on-site learning.

The additional four Shingo workshops are described as follows.

CULTURAL ENABLERS WORKSHOP

The CULTURAL ENABLERS workshop is a two-day workshop
that integrates classroom and on-site experiences at a host facility to
build upon the knowledge and experience gained at the DISCOVER
EXCELLENCE workshop. It leads participants deeper into the Shingo
Model by focusing on the principles identified in the Cultural Enablers
dimension:

• Respect Every Individual

• Lead with Humility

Cultural Enablers principles make it possible for people in an orga-

nization to engage in the transformation journey, progress in their
understanding, and, ultimately, build a culture of enterprise excellence.
Enterprise excellence cannot be achieved through top-down directives
 Introduction • 5

or piecemeal implementation of tools. It requires a widespread organiza-

tional commitment. The CULTURAL ENABLERS workshop helps par-
ticipants define ideal behaviors and the systems that drive them using
behavioral benchmarks.

CONTINUOUS IMPROVEMENT WORKSHOP

The CONTINUOUS IMPROVEMENT workshop is a three-day work-
shop that integrates classroom and on-site experiences at a host facility
to build upon the knowledge and experience gained at the DISCOVER
EXCELLENCE workshop. It begins by teaching participants how to clearly
define value through the eyes of customers. It continues the discussion
about ideal behaviors, fundamental purpose, and behavioral benchmarks
as they relate to the principles of Continuous Improvement, and takes par-
ticipants deeper into the Shingo Model by focusing on the principles iden-
tified in the Continuous Improvement dimension:

• Seek Perfection
• Embrace Scientific Thinking
• Focus on Process
• Assure Quality at the Source
• Flow & Pull Value

This workshop deepens one’s understanding of the relationship between

behaviors, systems, and principles and how they drive results.

ENTERPRISE ALIGNMENT & RESULTS WORKSHOP

The ENTERPRISE ALIGNMENT & RESULTS workshop is a two-day
workshop that integrates classroom and on-site experiences at a host facil-
ity to build upon the knowledge and experience gained at the DISCOVER
EXCELLENCE workshop. It takes participants deeper into the Shingo
Model by focusing on the principles identified in the Enterprise Alignment
dimension and the Results dimension:
6 • Discover Excellence

• Think Systemically
• Create Constancy of Purpose
• Create Value for the Customer

To succeed, organizations must develop management systems that

align work and behaviors with principles and direction in ways that are
simple, comprehensive, actionable, and standardized. Organizations
must get results, and creating value for customers is ultimately accom-
plished through the effective alignment of every value stream in an
organization. The ENTERPRISE ALIGNMENT & RESULTS workshop
continues the discussion around defining ideal behaviors and the sys-
tems that drive them, understanding fundamental beliefs, and using
behavioral benchmarks.

BUILD EXCELLENCE WORKSHOP

The BUILD EXCELLENCE workshop is the two-day capstone workshop
that integrates classroom and on-site experiences at a host facility to solid-
ify the knowledge and experience gained from the previous four Shingo
workshops. BUILD EXCELLENCE demonstrates the integrated execution
of systems that drive behavior toward the ideal as informed by the prin-
ciples in the Shingo Model. The workshop helps to develop a structured
approach to execute a cultural transformation. It builds upon a foundation
of principles, using tools that already exist within many organizations. It
teaches participants how to build systems that drive behavior, which will
consistently deliver desired results.

In this final Shingo workshop, participants will:

• Design or create a system, guided by the Shingo Model, that changes

behaviors to close gaps and drives results closer to organizational
goals and purpose.
• Answer the question: “How do I get everyone on board?”
• Build on the principles of enterprise excellence.
• Understand the relationship between behaviors, systems, principles,
and how they drive results.
 Introduction • 7

• Learn how key behavioral indicators (KBIs) drive key performance

indicators (KPIs), and how this leads to excellent results.
• Use “go and observe” to understand the practical application of the
Shingo Guiding Principles.

With this understanding of what this book is all about, the reader can
now take the first of many steps toward enterprise excellence.

DEFINITION OF LEAN
The term “Lean” was first adopted by authors James P. Womack, Daniel T.
Jones, and Daniel Roos in The Machine That Changed the World: The Story
of Lean Production. They describe Lean as manufacturing systems that are
based on the principles employed in the Toyota Production System (TPS).
Quoting them,

Lean … is ‘lean’ because it uses less of everything compared with mass pro-
duction—half the human effort in the factory, half the manufacturing space,
half the investment in tools, half the engineering hours to develop a new
product in half the time. Also, it requires keeping far less than half the inven-
tory on site, results in many fewer defects, and produces a greater and ever
growing variety of products.*

Lean’s philosophy has evolved through numerous iterations. It stresses

the maximization of customer value while simultaneously minimizing
waste. Lean’s goal is the creation of increased value for customers while
simultaneously utilizing fewer resources. To accomplish this, Lean utilized
a plethora of tools (over 100) to optimize the flow of products and services
throughout an entire value stream as they horizontally flow through an
organization. However, Lean does not capture the focus on cultural shift,
which was a necessary part of the original TPS, and which the Shingo
Institute attempts to restore. The Shingo Institute uses Lean in the mean-
ing that was intended when it was first coined by Womack, Jones, and Roos.

* Womack, J. P. et al. The Machine That Changed the World: The Story of Lean Production—Toyota’s
Secret Weapon in the Global Car Wars That Is Now Revolutionizing World Industry. New York, NY:
Simon & Schuster, Inc., 1990, p. 14.
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