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Monday, February 22, 2016

Lean is Not a Hunt for Waste it is a Journey to Add Value

Courtesy: http://www.allaboutlean.com/muda/
Undoubtedly, you have seen the narrow minded definition of Lean as a waste elimination tool. If you search the internet for a definition of Lean you will find many different suggestions, ranging from a few sentences to others that run many pages. Most miss the main point of Lean; they on the whole define lean as being a process of waste elimination. Unfortunately, this misses some of the major and most important parts of Lean.

It is difficult to define Lean in just a few sentences as Lean encompasses so much. To me it is:

Lean is all about respecting people while eliminating Muri (overburdening), Mura (unevenness), and Muda (non value added activity) in all business processes. It is a philosophy which embodies a culture of continuous improvement based on setting standards aimed at providing value through participation of all employees.

Lean Thinking is comprised of five fundamental principles:

1) Specify Value – End-use customer view
2) Indentify Value Stream – Activities that create value
3) Flow – Make value flow
4) Pull – Respond to customer demand
5) Perfection – Zero waste

Lean is Customer First, what is value in the eyes of the customer? What features and services does the customer want? When do they want them and what price do they want to pay? Without this information how can you design your ideal system?

This value needs to be made to flow from raw materials through to the consumer, this value stream needs to produce product at the pull of the customer. This is Just In Time manufacturing (JIT), producing what the customer wants when they want it!

Once you have the customer defined value flowing at the pull of the customer you strive for perfection, improving everything that you can about the product and process.

This is done by all within your organization, Lean values respect for people, involves everyone in the company to help meet customer value.

In some ways is could be said that Lean is more about preventing waste. By implementing the Lean principles above you identify those actions that add value and make them flow at the pull of the customer, this prevents the waste from occurring.

Lean follows a set of rules to provide value what I refer to as “Lean Rules-in-Use”:

1) Activity Rule – Specify all work to content, sequence, timing, and outcome.
2) Connection Rule – Customer-supplier connections must be direct & unambiguous.
3) Pathway Rule – Pathways for product/service must be simple & direct.
4) Improvement Rule – Improvements are made using scientific method (PDCA) at place of activity (Gemba) under the guidance of a teacher (Sensei)

If you follow this process you will not be going through a process of waste elimination and reduction but a more important process of waste prevention! So if you want to implement Lean manufacturing you must not just focus internally to impress your shareholders and make short term gains, but focus on the customer to make sustainable changes that will help your company flourish in today's world, not just struggle to survive.

If you only focus on an internally focused drive to eliminate waste, a process generally of cost reduction and labor elimination to reduce costs and increase profits, you forget the first and most important part of lean; what is value to the customer? The selfish drive to reduce costs wrongly assumes value on the part of the customer and the organization tends to become not Lean but anorexic! They remove the ability to be able to react to customer changes, to adapt when there are supplier and internal problems. Because of this companies that "have done lean" quickly revert to the way they were before the improvements, bringing back old inefficient processes to cover over other issues and rehiring the labor that they removed, Lean being put on the discard pile of management fads.

Lean Manufacturing is a business improvement philosophy that has developed over many years. Whilst Lean has a huge toolbox of tools and techniques you cannot define Lean from those tools. Lean is more than the sum of all of those tools, applying tools in isolation will not necessarily give you the benefits that you would expect and want to see. Lean is a method to better focus your business on the true needs of the customer to help you prevent waste from being built into your system.

Lean is not a hunt for waste it is a journey to add value.

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1 comment:

  1. Great idea about how to prevent waste! Any self-respected company must to establish a system about reducing or preventing waste. Nowadays this talks a lot about the company and its employees.