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Toyota’s A3 Form: A Tool for Innovating 

12/30/2015

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The A3 Form is an excellent tool for screening and managing a portfolio of projects. These projects can range from small improvements or supporting projects to major innovations. In effect, the A3 Form is a 2-page summary business plan that outlines the key components of an opportunity in a format that is easy to read and review. It can also be adapted to a computer database for searching, archiving and secured sharing.

The A3 form and the related A3 problem solving and continuous improvement methodology was first used by Toyota in the 1960’s and still used today. It was based on W. Edwards Deming’s teachings in Japan after World War II including his Plan-Do-Check-Act (PDCA) process, and brought to North America in the 1980’s. The A3 Form is named after the European paper size equivalent of two standard size pieces of paper i.e. about 11”x17”. 

The standard form is comprised of a header and seven sections [split 1-4 (Plan) and then 5, 6, 7 (Do, Act, Check) over two pages] as follows:
    0:   Title: A descriptive title along with the names of the author and manager, the date and          version number is provided.
  1. Background: This section outlines the problem, challenge or opportunity as well as linkages to other projects and supporting documentation. A Pain statement can be employed here.
  2. Current Conditions: Details of the current state including factors such as time, cost and quality are described. The relevant who, what, when, where, how and why of the situation is also described.
  3. Goals/Targets: These are summarized here with a focus on their value-add. What is in and out of scope should also be identified.
  4. Analysis: The gap between the current conditions and the desired future is outlined as well as the root cause(s) and effect(s). This is a critical step to endure the correct problem is being solved, not just the symptoms.
  5. Proposed Countermeasures (or Approaches or Solutions): A number of potential and even complimentary countermeasures should be described in order to highlight the thinking process, the financial impact (cost-benefit-risk) and those affected. This helps open potential dialogue with all stakeholders.
  6. Plan: A Gantt chart outlining the major tasks and milestones, the timing and dependencies, major resources, and the person or persons responsible as well as those needed for support and sign-off works well here.
  7. Followup: A list of activities to complete and metrics to collect in order to endure that the  value generated by this opportunity persists.       

Employing this tool provides a number of benefits:
  • The process behind the development of an A3 Form is as important as the final document. The process involves research, analysis, creativity, communication and collaboration. It is also an iterative process.
  • By completing the form sequentially, it facilitates obtaining a deep understanding of the true,  underlying problem before developing countermeasures (solutions).
  • In limiting the available space of the A3 form, it focuses the author on creating a concise overview that welcomes input from others. It is, of course, recommended that additional more detailed documentation be prepared in support of the project. 
  • By including a heavy dosage of graphics in the form of figures, flow charts, graphs and tables, the A3 Form becomes a form of standardized storyboard making it easily understood, in detail by collaborators, stakeholders and reviewers.
  • Although there is an overall section structure, the format within each section is totally at the discretion of the author making it very flexible. The goal remains to communicate a deep and complete picture of a challenge or opportunity in a concise, logical and readable format. 
  • Often it helps to sketch out initial versions by hand. This facilitates the collection of ideas and the development of useful graphics. If done in pencil, it also permits rapid revision.

References:
  • Shook, John. Toyota’s Secret: The A3 Report. MIT Sloan Management Review, Summer 2009.  http://sloanreview.mit.edu/article/toyotas-secret-the-a3-report/  and http://www.slideshare.net/mdmorin/toyotas-secret-the-a3-report?related=1

Good examples of A3 Forms (from a simple search of the internet):
  • http://blog.crisp.se/2009/09/23/henrikkniberg/1253687880000
  • http://www.slideshare.net/gokhansarpkaya/A3-Management
  • http://www.lean.org/common/display/?o=1103
  • https://www.moresteam.com/lean/a3-report.cfm
  • http://www.slideshare.net/gokhansarpkaya/A3-Management

Further reading:
  • https://en.wikipedia.org/wiki/A3_problem_solving
  • http://www.slideshare.net/5Ssupply/introduction-to-a3-problem-solving
  • http://www.umassmed.edu/uploadedfiles/fmch/faculty_resources/fall11_pelletiera3.pdf
  • http://www.coe.montana.edu/ie/faculty/sobek/a3/report.htm
  • http://www.slideshare.net/KarenMartinGroup/ucsd-class-a3-management-and-root-cause-analysis/28-Sample_A3Target_Condition_Measurable_Objectives
  • http://www.allbusiness.com/why-you-should-use-a3-planning-11747449-1.html
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Duncan Jones, Hexagon Innovating (2015) is licensed under CC BY-NC 4.0.
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Dean Kamen, DEKA Research and SlingShot

12/29/2015

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“We could empty half of all the beds in all the hospitals in the world just by just giving people clean water.” 
Dean Kamen in Slingshot

Recently, I watched the 2014 movie entitled SlingShot on Netflix. This documentary chronicles American entrepreneur and inventor Dean Kamen’s (1) and his firm, DEKA Research and Development Corporation’s (2) 15-year efforts to develop and market his “SlingShot” water-purification system (3). The film also touches on some of his other inventions including the Segway Personal Transporter (4), iBOT Wheelchair (5) and HomeChoice portable dialysis (6). Overall, I’d give the 97 minute movie a 3 out of 5 star rating. The documentary highlights many of the challenges of innovating (7):

Strategic:
  • Creativity is an important component of the innovation process and should be fostered within the work environment. 
  • A portfolio approach is necessary for successful innovation as no single “great” invention is sure to be successful in the market. 

Technical:
  • Prototyping is a valuable part of the process as it allows you, the team and even potential customers to visualize and experience the product or service.
  • Continuous experimentation and testing are critical to the development process. It is from successful as well as unsuccessful (some would call failed) experiments that the most learning and hints at the way forward are obtained.  

Commercial:
  • A commercially viable product, service or even business model must solve a real problem whether realized by the customer or not.
  • The final offering must deliver significant value to a customer/market segment. Not only does it need to solve an important problem, but it also has to achieve that: as well or better than than the competition, at a reasonable price (and cost to manufacture), in a form that is sufficiently easy to use, with an acceptable level of support, and at an acceptable size, weight and level of quality (durability, robustness) among many other factors.

Operational:
  • The innovation process benefits from teamwork as everyone has different skills and experiences to apply to this creative challenge and problem-solving activity.
  • Similarly, collaboration with outside firms and individuals is also valuable as they too can bring different skills and capabilities to bear.

Financial:
  • Innovation with its technical and commercial risks, the importance of a portfolio approach as well as the required experimentation and setbacks (failures), demand that a sustained, long-term investment be made.
  • Innovation is still business, not gambling so the appropriate risk to perceived rewards ratio must be frequently reviewed. It’s tough to kill projects, but it often needs to be done to make room for new ones with a better probability of success.

Execution(al):
  • The innovation process is always much slower, tougher and more costly than initially anticipated.
  • In order to get through the inevitable setbacks, you need maintain your passion for the ultimate vision and its value to your customer.  
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Duncan Jones, Hexagon Innovating (2015) is licensed under CC BY-NC 4.0.

1) I have always been intrigued by Dean Kamen. I met him at a conference in Philadelphia where he was a keynote speaker around 2001 or 2002, soon after the launch of the Segway. At that time, I was also fortune to demo the Segway.

2) DEKA was founded in 1982. It’s mission is “to foster innovation.” I tracked their inventions over time as a the IBOT was a competitor to the “Nimble” power wheelchair that the early-stage fund I managed had invested in. Similarly, the HomeChoice dialysis unit was similar to an opportunity that I evaluated on two separate occasions.

3) The underlying technology of the SlingShot water purification system is distillation of water (boiling it to create “clean” steam and then cooling it back to clean water). This is done in an efficient manner using computer controlled vapour-compression evaporation.

4) The Segway is the famous two-wheeled, self-balancing scooter that was backed by all the famous CEO’s in Silicon Valley and was launched in 2001 with incredible marketing fanfare. Unfortunately, it turned out not to be the success that was anticipated. Ironically, it was the predecessor of the various so called hoverboards that were launched in 2015 coincident with their prophecy in the 1989 movie Back to The Future II.

5) The iBOT is a power wheelchair that, with gyroscopic technology similar that in the Segway, allows it to rise up on two wheels to bringing seated occupants up to eye level as well as allowing it to climb stairs. Again, the product, launched in 2003, has not been very successful as there are “unreasonable” (stability-related) risks of injury which resulted it being classified as a Class III medical device as well as it being expensive ($25,000). It was licensed to Johnson and Johnson and discontinued in 2009. There are rumours of a new Class II categorized version that could fair better commercially.

6) The HomeChoice portable dialysis unit which was licensed to Baxter for automated, home peritoneal dialysis for severe, chronic kidney disease and launched in 1994 has been a very successful product line.

7) The six tenets of Hexagon Innovating are used as a framework to outline these challenges.

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    Hexagon-Innovating.com

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