Product Development Performance Metrics

During our Japan Kaikaku Experience trip in August, we visited Omron, a manufacturer of sensors and factory automation products. They have made great strides in implementing TPS, resulting in a very Lean factory. As part of their Lean implementation, Omron relocated their Product Development team to the same campus as their production team and adopted a Work Shop Management approach using Value Stream Organization.

Kaizen in Product Development: Measuring Engineer Productivity at Omron

They are in Phase III of their Lean transformation, nearly 7 years into the process of applying the Toyota Production System model. Omron is implementing kaizen beyond the factory (Phase I) and factory indirect (Phase II) to include the Product Development process. There are many notable aspects of kaizen at Omron. One thing that was particularly eye-opening was their response to the question “How do you measure the productivity of your engineers in Product Development?” At Omron, the performance of Product Development engineers is measured by the sales of the new product over their lifespan.

Omron’s Collaborative Approach to Lean Product Development

Omron’s approach to Lean Product Development is a remarkable feat that requires a high level of customer intimacy and cross-functional coordination among various departments. The co-location of Product Development and Production, along with the use of their own factory automation devices, allows for a more streamlined and efficient process. Omron’s dedication to Lean manufacturing not only benefits the company but also its customers, ensuring that they receive high-quality products that meet their needs. Overall, Omron serves as a prime example of how Lean principles can be applied to Product Development to achieve remarkable results.

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