What's the difference between ZBT and TMS?


The purpose of this chapter is to clearly explain the differences between a ZBT and TMS and highlight their unique purposes.

Background Reading

How to Build a ZBT for your Team

How to Build a TMS for your Team

Core Differences

Most managers do not truly understand the differences between a ZBT and TMS.

When they’re asked to explain how they are different, you will likely hear a jumbled response which shows that the manager thinks they are essentially the same thing.

In reality, they are quite different and serve unique purposes. In summary, a TMS shows how and how much the team is producing today while the ZBT sets the goal for how and how much the team is actually capable of.

Short answer

Simply put: TMS is the difference between your top performer and the bottom performer/rest of the team, while the ZBT is the next step: it's the difference between your top performer and the most ideal workflow.

Long answer

A ZBT tells you, in a perfect world, how many units (and at what cost) your team is capable of producing.

Since ZBT’s include the granular steps required to produce a unit, they also set a goal for how your team should produce units in an ideal world.

Since the fundamental assumption for the ZBT is ‘in an ideal world’, the ZBT is going to be aggressive. If your ZBT goal is not at least 1/2 your TMS, you didn’t do your ZBT properly.

With this aggressive ZBT goal, elite managers set the vision for their team: “Guys, we are nowhere close to this today but look where we can go. Look what’s possible.”

Elite managers don’t just tell their team to double productivity but they explain, with real data from their ZBT, that it’s possible to get there.

And not only is it possible to get there but how to get there: a great ZBT identifies the right process and highlights automation that need to be invested in.

If you’re looking for some ZBT inspiration, this quote summarizes it well: “You see things and you say 'Why?' But I dream things that never were and I say 'Why not?'” - George Bernard Shaw (1856–1950)

A TMS tells you how many units (and at what cost) your team is currently producing units at. Since TMS’s include the granular steps required to produce a unit, they also reveal how your team is currently working.

A good TMS will have data from 5 different ICs which will average out the top and bottom performers. So really, it’s only a goal for the bottom performers on your team.

A good TMS serves several purposes:

  1. Sets expectations for how many units should be produced by the team

  2. Documents the correct process the team should follow

  3. Guides ICs on how much time each step should take

  4. For bottom performers: serves as a goal to strive for

A note on the order of TMS and ZBT: In the past, as mentioned in the ZBT training video (25th minute), we wanted managers to do ZBT before, to allow people think independently from TMS. However, later we realized managers (especially the new hires who never worked in the factory before) deliver poor/unrealistic ZBT because they don't even know what the team does. As a result, we concluded that TMS needs to be done first so that manager can understand what the team does.

Summary Table