Leanis a management philosophy that focuses on eliminating unproductive activity (waste). Lean thinking helps to improve efficiency, customer satisfaction, quality and at the same time employee satisfaction. The aim is to produce/deliver the right quantity, the right product/service, of the right quality, in the right time.
Lean thinking and forms of waste
One of the basic principles of lean is to reduce waste. Lean defines 8 forms of waste, which help to identify which activities are wasteful. Waste analysis is a powerful tool for process improvement.
The eight forms of waste:
- Error: activities where errors occur.
- Transport: moving materials from one place to another.
- Motion: extra movement of workers.
- Stocks: excess stocks or too little stock, bringing production to a standstill.
- Skills: employees may either be too skilled for the job, in which case their skills are under-utilised, or they may not have been adequately trained for the job, in which case there is an increased chance of errors, for example.
- Overproduction: producing more of a product/service than there is need or demand for.
- Waiting time: the time spent waiting for things like raw materials, tools and the start of work.
- Over-processing: over-processing is adding more features to a product or service than the customer needs.
Lean waste in business/service sector
The above listed definitions of wastage have been developed for an industrial environment and can be challenging to apply to business processes such as services. Here are my suggestions for "translations" of waste forms that are more suitable for business use outside the industrial environment.
- Error: activities where errors occur.
- Transfers: moving data from one place to another.
- Movement: unnecessary movement of workers.
- Accumulating work: work that is waiting to be processed and may become backlogged.
- Skills: workers may be doing tasks that are too simple for their skills or lack adequate training for the job.
- Redundant work: creating and editing unnecessary documents, services, etc., e.g. reports or analyses that are not used or do not add value for the customer.
- Waiting time: the time spent waiting for things like the start of work, a decision or resources.
- Over-precision: more features are added to the service than the customer needs. Unnecessary finalisation and revision of functions, overly complex processes and work instructions.
Lean culture
Implementing lean thinking in an organisation is a major cultural change. When an organisation wants to change its culture, the "classic" way (i.e. the methods commonly used in the organisation over the years) is to start with interviews and an organisational mapping exercise organised by consultants. The mapping process is used to establish the appropriate norms and attitudes for the organisation. Finally, the appropriate tools are put in place. Change takes a long time and achieving results is challenging.
Lean approaches organisational change in the opposite way. Lean starts with the use of various Lean tools. When these tools are used for a long enough period of time in an organisation, they form the basis of a Lean mindset. When this attitude is sufficiently widespread in the organisation, it gradually becomes the norm throughout the organisation (Lean culture of continuous improvement). As Lean tools are relatively easy to use, the start-up process is also quick and the first results are quickly obtained.
The "ease" of the first results may give the impression that it is easy to create continuous improvement in an organisation. Indeed, many organisations start with Lean, but only less than 10% of organisations achieve a culture of continuous improvement. Success requires discipline and management support to enable employees to improve processes on a sustained basis. To read more about change management and the role of management in change, read Lean Leadership: 6 factors to achieve more results
Background on Lean
The term "Lean" was first defined in the 1990s by Womack and Jones in their book "The Machine That Changed the World". Lean is based on the principles of the "Toyota Production System" (TPS). TPS was developed between 1948 and 1975. TPS focuses on developing people's reasoning abilities with the support of Lean coaches. Employees learn how to continuously improve their own work in small steps.
Over the years, Lean has proven its effectiveness as a process improvement tool. The method has been used for decades worldwide in sectors ranging from Fortune Top 100 companies to small organisations of a few dozen people. Today, Lean is used worldwide in industry, services and the public sector and its popularity continues to grow.
When to use Lean?
Lean is a business process improvement methodology that allows an organisation to improve its processes systematically, objectively and efficiently. The result is a culture of continuous improvement, where business results and customer and employee satisfaction are improved through process efficiency. In general, lean helps whenever there is a need to improve something, for example in situations where:
- Long lead times / delivery times
- Costs
- Lack of employee motivation
- Low customer satisfaction
- Lack of a culture of continuous improvement
Lean often achieves improvements of 50-90%.
LEAN: Improving processes by working smarter, not harder.
Examples of results achieved
Results at process level
- Reduction in service lead time from 25 -> 1.5 days in 2 weeks + improvement in job satisfaction from 4 -> 8 (max. 10). A culture of continuous improvement after the project.
- In general:
- 50-90% improvement in process lead times
- Productivity improvement of 10-40%
Examples of typical improvement projects:
- Reducing Product Delivery Time
- Reducing Errors in Stock Management
- Reducing the Lead time of the Invoicing Process
- Reducing the lead time of the production process
- Reducing the time taken to process an application
- Reducing complaints
- Reducing the number of error messages
- Improving the volume of telephone sales
Examples of policy change
"It's really impressive to see how my employees' mindset and approaches have changed over the course of the project. It's a pity we didn't start Lean sooner." CEO of a service company
"Why haven't we understood to act like this before?" Project leader
"Work is much calmer now." Employee
Adopting Lean thinking is about learning to look at your own working environment through new "Lean glasses".
5 Principles of Lean
Womack and Jones studied Toyota's operations for years, and based on this, in their book Lean Thinking (1996), they described five steps for lean working. These five steps are a good and concrete starting point for process improvement:
1. Value
Determining the value of the process based on the customer's wishes.
2. The value chain
Identifying the value chain for different products and eliminating waste from the chain.
3. Flow
Designing value-added activities in the chain so that movement from one activity to another is as smooth as possible.
4. Pull control
Planning, offering, and manufacturing in tune with the customer's needs.
5. Striving for perfection
Continuous process improvement.
If you are interested in learning how to improve processes according to the five principles of Lean, you should check out the Lean Change Leader training.
The synergy between Lean and Six Sigma: Lean Six Sigma
Lean Six Sigma combines the benefits of Lean and Six Sigma to enable the rapid, flexible and effective improvement of very different processes in very different organisations. It is usually a good idea to start with Lean thinking and methods for process improvement and expand to Six Sigma when there is a lot of data and/or the results are no longer sufficiently achieved by Lean-based methods. Read more about Lean Six Sigma: What is Lean Six Sigma?
Lean training: learn to Lean
If you are interested in learning more about Lean, how to apply Lean, you should check out the different 1-5 day training options:
If you have any questions, please contact us.
Lean Six Sigma,
Certified Lean Six Sigma Master Black Belt
