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Unclogging the arteries of innovation through the magic of focus and simplicity: Steve Jobs and the Toyota Way.

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With the death of Steve Jobs last year, there has been an uprush of interest in what made this great business genius tick. What are the secrets of his success?

In a recent article in Harvard Business Review, his biographer Walter Isaacson discusses what he feels were two of Jobs’ most important leadership principles: focus and simplicity.

“When Jobs returned to Apple in 1997, it was producing a random array of computers and peripherals, including a dozen different version of the Macintosh. After a few weeks of product review sessions, he’d finally had enough. ‘Stop!’ he shouted. ‘This is crazy.’ He grabbed a Magic Marker, padded in his bare feet to a whiteboard, and drew a two-by-two grid. ‘Here’s what we need,’ he declared. Atop the two columns, he wrote ‘Consumer’ and ‘Pro’. He labelled the two rows ‘Desktop’ and ‘Portable.’ Their job, he told his team members, was to focus on four great products, one for each quadrant. All other products should be cancelled,” writes Isaacson. “But by getting Apple to focus on making just four computers, he saved the company.”

This focus, according to Isaacson, allowed Jobs to filter out “what he considered distractions.”

An instinct for simplicity

To complement this razor-sharp focus, writes Isaacson, Jobs had the instinct for simplicity, which enabled him to eliminate impractical frills in his designs.

“Jobs’ Zen-like ability to focus was accompanied by the related instinct to simplify things by zeroing in on their essence and eliminating unnecessary components. ‘Simplicity is the ultimate sophistication,’ declared Apple’s first marketing brochure. Jobs aimed for the simplicity that comes from conquering, rather than merely ignoring, complexity. ‘It takes a lot of hard work,’ he said, ‘to make something simple, to truly understand the underlying challenges and come up with elegant solutions.’”

Sure, Jobs had other leadership skills and traits that some applaud and others vilify. But focus and simplicity resonate with one of today’s fastest-growing forms of leadership: lean leadership. Lean principles are turning up everywhere from business magazines to engineering journals, self-development literature to cookbooks. Does this last one seem out of place to you? It shouldn’t. Lean is about cutting out the fat.

Jobs’ ability to focus and simplify helped him cut the fat.

The lean approach

The organisation that really pioneered these concepts of lean is Toyota, integrating these principles so deeply into its culture that it cannot exist without them – so much so that lean leadership is generally known as The Toyota Way.

Toyota’s lean approach is based on a few key aspects: eliminate waste, empower employees to make decisions, and constantly strive for improvement. It cannot be implemented overnight on site while reading the pages of a self-help guide, though. TheToyota Wayis a philosophy, and ultimately should translate into an organisational culture rather than a set of rules and protocols. It is an approach that requires a specific kind of leadership.

“I worked at Toyota Tsusho for many years,” says Fortune Sibanda, who directs a programe on lean leadership at theUniversityofCape Town’s Graduate School of Business. “This is a company that is still very much rooted in Japanese culture and business practice.

“TheToyota Wayis very tangible in Toyota Tsusho. The organisational culture is very structured and disciplined, and the decision-making process is truly unique in my experience. They’ve created a system that creates thinking. And that is what lean leadership is all about.”

According to Sibanda, the lean leadership principle works for any organisation in any business and contains seven essential behaviours for leaders: know your people and business, insist on honesty, set clearly defined goals and priorities, always follow through (Plan Do Check Action), reward the doers, expand people’s capabilities, and know yourself.

“There is one great myth about this leadership technique, that it is a once-off event, a destination. Instead it is a journey of constant improvement. It is not a project. There are no formulae or textbooks. It is a philosophy; a way of being in an organisation,” she says. “Ultimately, such a philosophy needs to be embedded in the DNA of an organisation for it to be effective.”

“Lean leadership’s strongest trait is that it allows for the fastest response to a problem. A solution can be designed and implemented very quickly. Problems are solved every second, every hour of the day,” says Sibanda.

Embracing a lean culture

It is a culture that has allowedToyotato climb out of the disaster and calamity that struckJapanandThailand, and the recall scandal of 10 million defective automobiles, causing the company to lose their lead above their competitors. Forecasts suggest thatToyotais back on track with record group sales of 9,58 million vehicles this year.

It is a culture that is at present addressing serious issues in South African hospitals.

The Department of Health Rapid Process Improvement Workshops was a project launched in 2010 by Lean Institute Africa, commissioned by the national department of health, to test the lean approach in 18 public hospitals in ‘priority’ health districts. Overall, 336 individuals participated in the workshops, 18 of which are managers at the hosting hospitals.

The workshops targeted waiting time reduction, stock availability, patient file availability, cleanliness, patient flow, infection control, waste segregation, theatre improvement, equipment repair, month end data capture, and emergency response times.

“The results were staggering, with marked improvements experienced throughout. And delegates were overwhelmingly in support of the general Lean approach with almost 70% of the hospitals sustaining the improvements,” says Professor Norman Faull, Director of Lean InstituteAfrica. Evidently, Jobs’ focus and simplicity, and the very similarToyota Way, can be applied to sectors other than private business where innovation is aimed at social good.

Although Jobs never referred to his leadership style as “lean,” the overlaps are obvious. The common denominator is the constant effort to cut the fat and look for, in Jobs’ words, “elegant solutions.”

Toyotaand Apple constantly innovate at the forefront of technology: Apple has just given the world the sleek and updated iPad andToyotarecently launched its incredible FT 86. Due to a leadership approach that unclogs the arteries of innovation, these companies are likely to endure for years to come, unlike those still struggling with clots of waste, bureaucracy and visionless leadership.

The Lean Leadership programme

The Lean Leadership programme at the UCT GSB runs from 7 – 9 May. For more information please contact Iona Gutuza on +27 (0)21 406 1368 or visit www.gsb.uct.ac.za/leanleadership 

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Bitcoin Family Of Coins – Who Will Win?

Off the back of 6 sold out live events, and after successfully hosting the biggest #Cryptocurrency event ever held in South Africa, the Matt Brown Show is holding a one-time exclusive learning and networking event in Johannesburg on Wednesday, 7 March (6pm – 8pm) we’ll be launching a deep dive series into alternative cryptocurrencies.

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The interest around cryptocurrencies, with Bitcoin being the most famous, has continued to capture headlines worldwide whilst regulators around the world are still struggling to formulate a plan to deal with it.

The Matt Brown Show #cryptokungfu is kicking off its first edition of a deep dive series will be looking at the bitcoin family of coins, what makes the coins different, their utility and the opportunities for traders and investors.

The Matt Brown Show has built a listenership and captive audience in over 100 countries around the world. #CryptoJHB was the first podcast event to trend in the #1 hashtag position on Twitter in the history of South African media.

Related: 11 Things You Need To Know About Bitcoin

The Matt Brown Show Johannesburg event taking place on Wednesday, 7 March 2018 from 18:00pm to 20:00pm, now being hosted at the Mesh Club in Rosebank will tap into THREE of the world’s leading experts for this first edition of a deep dive series focused masterclass.

The Masterclass will feature Tone Vays (via video conference) and Adam Meister from the United States, both regarded as world’s leading Bitcoin experts. Lorien Gamaroff, founder/CEO of Bankymoon, blockchain and cryptocurrency consultant will provide the local market perspective as a South African.

The masterclass has been engineered to provide a more focussed and intimate discussion on the landscape, which is one of the reasons the event was moved to the mesh club. To provide a more exclusive and engaging atmosphere for the attendees.

Matt Brown says, “these 3 experts have the uncanny ability to read the cryptocurrency market and are considered part of the top 100 most influential people in blockchain/cryptocurrency space in the world”.

“So we need to look beyond the recent surge in bitcoin investors across Africa, businesses have also started to embrace the cryptocurrency. It no longer a fad but a reality of the world we live in today” says Brown.

South Africa continues to lead the way, with businesses now starting to accept bitcoin payments.

Gamaroff says, “The global financial system is crumbling. People are seeking alternatives to fiat money. Cryptocurrencies will be their hedges against the cataclysm that is coming.”

Related: Embracing Technology For Business

“The reality is that Bitcoin is here to stay and, with many seeing a good return on their investment in cryptocurrencies, they now want to use this digital cash to invest in their future” says Brown

“Today, South Africans are using the ease of online trading to make money that they can then reinvest in a future beyond the world of forex. Which is why we continue to see the demand for events like this, being attended by a mixture of cryptocurrency enthusiasts and/or people simply interested in learning more about this space.” Concludes Brown.

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The Workspace And MiWay Announce Entrepreneur Competition

To celebrate their collaboration at Village Road, The Workspace and MiWay are launching a competition for South Africa’s entrepreneurs that will see the winner/s given a major advantage to further grow their business.

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Space solutions and coworking specialist, The Workspace, and insurance company, MiWay, recently joined forces at The Workspace’s premises in Village Road, Selby where they have launched an entrepreneurial hub and business development programme in the Johannesburg CBD.

The competition is open to entrepreneurs based in South Africa who have valid identification documents, who run a business with four or less employees and are making an impact in their industry.

“We have always believed in assisting entrepreneurs and small business owners who are members of The Workspace community in whatever way we can. This entrepreneur competition takes it to the next level, giving a voice to our belief in entrepreneurship and its ability to create jobs,” says Mari Schourie, CEO of The Workspace.

Related: 6 Resources For Start-ups Looking For Funding

Morné Stoltz, head of Business Insurance at MiWay, says both companies are committed to upliftment initiatives and economic development. “The entrepreneur competition is a call to action to those vibrant entrepreneurs out there. Start-ups always need a bit of a hand-up and the winner of this one will have a serious advantage once the competition has gone through its paces,” he said.

Schourie and Stoltz agree they’re looking for an entrepreneur who has reinvented the way business is done in his/her industry. “Someone who has been innovative in the product or service being offered to the market,” says Schourie.

“We are looking for an entrepreneur who has or is busy creating a special environment where employees can flourish, and in the process, potentially creating more jobs,” Stoltz adds. “An entrepreneur who makes an impression on the judges due to aspects such as the business’ social impact, attitude, positive entrepreneurial outlook and a good business mind”.

Related: 4 Tips To Secure Funding For Your Start-up

The prize on offer – worth over R230 000 – will help set-up the winning entrepreneur for a period of 12 months, giving them a boost to help build their business.

All information on the Entrepreneur Competition is available on The Workspace website, including criteria, terms and conditions, and of course, the prizes.

For queries, please email events@theworkspace.co.za

Download the competition criteria here.

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Budget 2018/9: 3 Key Tax Areas To Look Out For In The Speech

High political drama in the opening weeks of Parliament aside, most South African business and personal taxpayers are expecting tax hikes across the board from the Finance Minister’s Budget Speech on 21 February.

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As we approach #Budget2018 day, Rob Cooper (tax expert and Director of Legislation at Sage, and chairman of the Payroll Authors Group of South Africa)has a few thoughts about what the Minister could clarify in his statement.

Government already faces a yawning budget deficit, aggravated by the need to find billions of rand to fund a new and unbudgeted-for commitment to free tertiary education.

While some spending cuts could help to release funds, we can expect a one to two percentage point increase in VAT, steep hikes to fuel levies and sin taxes, higher capital gains taxes, and perhaps even personal income tax hikes for high income earners.  We’re also likely to get more info on new taxes such as the carbon tax.

Personal taxpayers, with the exception of low-income earners, should probably not expect the Finance Minister to adjust personal income tax brackets and rebates to fully cater for the effect of inflation. In other words, even if your salary is worth less as a result of inflation, you should probably not be hoping for your effective tax rate to come down to compensate.

Here are three other things I’m looking out for in this year’s budget, each of which will have a major effect for employees and employers alike:

1. National Health Insurance

One of the big will-he-or-won’t-he questions the Finance Minister faces this year is whether to do away with the modest tax credit taxpayers receive for their medical aid payments. Government is eyeing an estimated R25 billion in funds from scrapping these tax credits, to be used to fund the incoming National Health Insurance scheme.

Many of us expected Minister Malusi Gigaba to announce this move in his Mid-Term Budget Speech in October 2017, but he held back. The move is likely to be contentious since a National Treasury analysis shows that 56% of the total credits claimed in 2014-2015 accrued to around 1.9 million taxpayers with a taxable income below R300,000.

In other words, the medical aid credit makes decent healthcare affordable to millions of people who might not otherwise be able to afford it. Taking it away could have dire consequences for the health of millions of lower income South Africans and put even more strain on an already pressurised public healthcare system.

Related: Budget Speech: The Impact on SMEs

2. Travel reimbursements and allowances

Travel reimbursements have long been a pain point for many employers and employees. Up to 28 February 2018, a portion of an employee’s travel costs was treated as remuneration when:

  • The per-kilometre rate used to calculate the travel reimbursement was greater than the SARS-prescribed rate per kilometre.
  • An employee is reimbursed for more than 12,000 business kilometres are reimbursed during the tax year.
  • The reimbursement value was greater than the prescribed maximum number of business km (12 000 km for 2018) multiplied by the prescribed rate per kilometre (R3,55 for 2018).

The result was that skills development levies and UIF contributions were added to something that should be considered as an operational cost rather than a payroll cost. This in turn increased the employer’s cost of employment. These levies and contributions were not assessed at the end of the tax year, so employers could not claim a refund.

We have long argued this regulation should be changed to be fairer to employers and employees alike. As a first step in the right direction, SARS has announced a simplification of the travel allowance and the travel reimbursement provisions, with effect from 1 March 2018.

Under this change, only the portion of the value of the travel expenses reimbursed at a rate above the ‘prescribed’ rate per kilometre will be treated as remuneration.  However, in future, we would like to see SARS handle travel reimbursements in the same way as it treats subsistence allowances for employees when they travel.

The excess portion of the subsistence allowance will be taxed on assessment, but it is not remuneration for the purposes of Pay-As-You-Earn (PAYE), skills development levies and UIF.

3. Employment Tax Incentive

I’m a fan of the Employment Tax Incentive (ETI) as an innovation geared towards addressing South Africa’s youth unemployment crisis, and the decision to extend the programme until the end of the 2019 tax year is welcome. However, administration of the scheme has always been complex for SARS and employers alike, a factor that has made some companies hesitate to take advantage of it.

Though SARS and the National Treasury have tweaked the ETI over the years, I would welcome further simplification of the definitions and calculations. That said, I don’t expect much news about the ETI this year, apart from alignment with the National Minimum Wage expected to be introduced from 1 May 2018.

Follow us on @SageGroupZA on 21 Feb for LIVE expert insights from the annual Budget Speech.

For more information about Sage’s annual tax seminars, please visit: http://go.sage.com/NPS_18Q1_C4L_ZA_EVCU_HR0310_20thAnnualPayrollTaxSeminarLP

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