What Your Firm Can Learn from Toyota

One of the most important business concepts of the late 20th century was Six Sigma as promoted by General Electric CEO Jack Welch. Six Sigma at many organizations simply means a measure of quality that strives for near perfection. Six Sigma is a disciplined methodology for eliminating defects in any process ' from manufacturing to transactional law. Six Sigma training and practices are still commonplace in many Fortune 500 corporations. Following this efficiency explosion, LEAN Processing, as developed by Toyota, is without question the most important approach to business process of our times. Toyota lives this approach every day, which is why it will soon be the largest, most successful car company in the world.

Two Magic Words

LEAN Processing essentially comes down to two words: “Kachi” and “Muda.” For those who don't speak Japanese, kachi means value, and muda means waste. To simplify this even further, your job as a well-paid professional in your firm is twofold. It is to use your time, intelligence, and experience to simultaneously increase value and eliminate waste for both your clients and your firm. By increasing value and eliminating waste, you instantly increase your firm's profits and your client's satisfaction.

Three Real-World Applications in Your Firm

Twenty Minutes of Waste

We have done a number of studies on how the average person interacts with his or her technology. First let's look at the simplest of technology: the telephone. In one study we had participants work on an intensive document (for your purposes let's assume it is a brief or court appeal). In the middle of this work, the phone rings and the participant picks up. The participant speaks with the other party for 15 minutes. He then hangs up the phone and resumes his work on the document. We've measured the average amount of time it takes an individual to get “back in the groove” of his or her work. The results were between 15 to 20 minutes! Fifteen to 20 minutes to reread what you had done up to that point and refocus your mind to where it can continue to process the document. The critical question now is: Who do you bill those 20 minutes to? You've added no real value to the document in that period. You simply created 20 minutes of waste. We need to seriously look at these habits and correct them.

Form and Function

Take a tour of a Toyota plant and you'll have an amazing experience. As you walk the facility you will notice that all of the equipment has a specific form and function. Each function adding important value. This is not the case with most attorneys' offices. Many attorneys don't know how to properly use their offices, resulting in huge unmanageable piles of papers, which dramatically decreases productivity. Remember the essential rule of design: Form follows function. Your desktop, your floor, and your chairs were not designed to be storage facilities, so get the papers off of them ' that's what drawers are for. Create a comprehensive file system based not only on matter but also on the time/value of your documents. We recommend a working, reference, and archive division. Make sure the system includes all of your work responsibilities and areas for personal documents. Establish the proper home for all objects in your office; put them away and watch how your stress immediately decreases and productivity increases. This will also do wonders for the brand that both you as an individual and the firm would like to project to potential and current clients.

Electronic Communications

How many messages are in your e-mail inbox? If you require a scroll bar, you are creating waste by not processing your electronic communications efficiently. Your electronic world should be just as organized as your physical world. At the end of the day, both your physical and electronic in-box should be empty. The vast majority of “fires” that have to be put out on a daily basis were not emergencies when they first appeared in your office. They became high priority due to individuals not processing the information in a timely, effective manner. Just as Toyota is able to follow each and every step of its manufacturing process, with precision and accountability, we need to establish a process by which all information which enters our office can be moved along in a precise fashion. Every time we “touch” a piece of information we need to add value and move it toward completion. At Integra we use the 4D method of: Do it, Designate it, Delegate it, or Dump it.

Conclusion

Remember, attorneys and clients don't leave firms; they leave the partners they work with. The cost of recruitment and retention is enormous. Any adjustments we can make to our management style using LEAN processing techniques can significantly beef up the firm's bottom line. Remember every day, your job is to increase value (kachi) and reducewaste (muda). Do it now!

This article originally appeared in Law Firm Partnership & Benefits Report, a sister publication of this newsletter.

Paul Silverman is the President of Integra Workshops, which offers a variety of efficiency workshops that help professionals realize productivity gains and stress reduction. He can be reached at [email protected].

One of the most important business concepts of the late 20th century was Six Sigma as promoted by General Electric CEO Jack Welch. Six Sigma at many organizations simply means a measure of quality that strives for near perfection. Six Sigma is a disciplined methodology for eliminating defects in any process ' from manufacturing to transactional law. Six Sigma training and practices are still commonplace in many Fortune 500 corporations. Following this efficiency explosion, LEAN Processing, as developed by Toyota, is without question the most important approach to business process of our times. Toyota lives this approach every day, which is why it will soon be the largest, most successful car company in the world.

Two Magic Words

LEAN Processing essentially comes down to two words: “Kachi” and “Muda.” For those who don't speak Japanese, kachi means value, and muda means waste. To simplify this even further, your job as a well-paid professional in your firm is twofold. It is to use your time, intelligence, and experience to simultaneously increase value and eliminate waste for both your clients and your firm. By increasing value and eliminating waste, you instantly increase your firm's profits and your client's satisfaction.

Three Real-World Applications in Your Firm

Twenty Minutes of Waste

We have done a number of studies on how the average person interacts with his or her technology. First let's look at the simplest of technology: the telephone. In one study we had participants work on an intensive document (for your purposes let's assume it is a brief or court appeal). In the middle of this work, the phone rings and the participant picks up. The participant speaks with the other party for 15 minutes. He then hangs up the phone and resumes his work on the document. We've measured the average amount of time it takes an individual to get “back in the groove” of his or her work. The results were between 15 to 20 minutes! Fifteen to 20 minutes to reread what you had done up to that point and refocus your mind to where it can continue to process the document. The critical question now is: Who do you bill those 20 minutes to? You've added no real value to the document in that period. You simply created 20 minutes of waste. We need to seriously look at these habits and correct them.

Form and Function

Take a tour of a Toyota plant and you'll have an amazing experience. As you walk the facility you will notice that all of the equipment has a specific form and function. Each function adding important value. This is not the case with most attorneys' offices. Many attorneys don't know how to properly use their offices, resulting in huge unmanageable piles of papers, which dramatically decreases productivity. Remember the essential rule of design: Form follows function. Your desktop, your floor, and your chairs were not designed to be storage facilities, so get the papers off of them ' that's what drawers are for. Create a comprehensive file system based not only on matter but also on the time/value of your documents. We recommend a working, reference, and archive division. Make sure the system includes all of your work responsibilities and areas for personal documents. Establish the proper home for all objects in your office; put them away and watch how your stress immediately decreases and productivity increases. This will also do wonders for the brand that both you as an individual and the firm would like to project to potential and current clients.

Electronic Communications

How many messages are in your e-mail inbox? If you require a scroll bar, you are creating waste by not processing your electronic communications efficiently. Your electronic world should be just as organized as your physical world. At the end of the day, both your physical and electronic in-box should be empty. The vast majority of “fires” that have to be put out on a daily basis were not emergencies when they first appeared in your office. They became high priority due to individuals not processing the information in a timely, effective manner. Just as Toyota is able to follow each and every step of its manufacturing process, with precision and accountability, we need to establish a process by which all information which enters our office can be moved along in a precise fashion. Every time we “touch” a piece of information we need to add value and move it toward completion. At Integra we use the 4D method of: Do it, Designate it, Delegate it, or Dump it.

Conclusion

Remember, attorneys and clients don't leave firms; they leave the partners they work with. The cost of recruitment and retention is enormous. Any adjustments we can make to our management style using LEAN processing techniques can significantly beef up the firm's bottom line. Remember every day, your job is to increase value (kachi) and reducewaste (muda). Do it now!

This article originally appeared in Law Firm Partnership & Benefits Report, a sister publication of this newsletter.

Paul Silverman is the President of Integra Workshops, which offers a variety of efficiency workshops that help professionals realize productivity gains and stress reduction. He can be reached at [email protected].