Insights from Nebo

Toyota is famous for their production process. They designed a system that eliminated waste, stress and inconsistency to levels that were previously considered implausible. Books have been written on the process. But, what isn't well known is that their paradigm-shifting production process was based on a very simple insight originally developed by Sakichi Toyoda.

Sakichi was the father of the Japanese industrial revolution. He cut his teeth building weaving devices and looms. When trying to perfect an automated loom, he actually conducted a year long experiment that had his looms running against his competitors in a real world environment. As each of his looms failed he focused on how to improve their performance.

The methodology he used was simple. Like any good problem solver, he started by asking "Why." But, he realized that you can't get to the root of the problem with a single question. A single question only identifies the symptom, not the root problem.

Like a child trying to figure out why the sky is blue, he repeated the question a minimum of 5 times in order to get to the root of the problem. This simple insight was the birth of what is known today as "the 5 whys method."

Why did the loom break? Because the gear jammed. Why did the gear jam? Because it ran out of oil. Why did it run out of oil? Because the operator didn't add it. Why does the operator need to add oil? Because oil isn't automatically added. Why isn't oil automatically added? Because there isn't an oil pump.

Sakichi's method of root cause analysis is now taught in MBA programs around the world. But, his genius wasn't related to some magic insight. The "5 Whys" method is applied common sense. It's development was the result of his fierce tenacity in trying to get to the root of his problems. His brilliance was that he institutionalized this tenacity among his process engineers. He "made it stick" by giving it a memorable name ("the 5 whys") and in the process he revolutionized process manufacturing.

So next time you're asking yourself, "what went wrong?", remember Sakichi Toyoda and the 5 whys. It may annoy your co-workers, but at least you'll be closer to the root of the problem.

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"If I had asked people what they wanted, they would have said faster horses."

- Henry Ford

Focus groups are frequently used to predict consumer reactions to things like movies, tv shows, and new products, but focus groups have a track record full of failures. So why do we keep using them?

According to Daniel Gross, focus groups have become ingrained into our approval process more for the sake of decision makers than for the sake of consumers. Focus groups have fixed costs, are timely, and most often used to affirm preconceived notions: "See, they agree!"

What focus groups don't do is accurately predict how consumers will react. According to Gerald Zaltman, author of How Customers Think, 80% of new products fail within the first six months, many of which go through focus groups.

So, why do focus groups fail? Focus groups fail because:

1. People can't predict what they want and don't understand their own motives for making decisions.
2. Consumers have other motivations for answering and participating in the group than contributing to the end product.
3. Focus groups address symptomatic, surface level issues rather than the root problem.
4. The social dynamics of a focus group have an effect on people's answers. Whether it's because they desire to maintain their image, give the appropriate answer, or just fit in, people often lie when they are put in situations with strangers and asked questions.
5. Focus groups assume consumer input is valid, regardless of the individual's relevant knowledge or experience.

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Check back next Monday for some good reads and visuals, or follow us on Delicious for a heavier load.

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