What organization would turn away from a system which eliminated waste? In today’s business climate of doing things faster, better and at less cost and with less waste, the Lean system of management and/or manufacturing has been proven to eliminate overproduction, wasted steps and movements, unnecessary transport and conveyance times, and waiting periods. Sayer and Williams (2007) in their book, “Lean for Dummies” demonstrate the advantages of this concept.
Sayer and Williams (2007) compare the Lean concept of business and organizational strategy to the physical and mental strength of the athletic or physically fit: There is nothing there that cannot be used, no excess fat, and no waste (p. 10). Where previous business practice involved the mass production of a product to be sold to the masses, management would find they were often left with extra inventory. Inventory not sold is a lost profit potential, the inventory itself requires space to store and is yet another waste, and a surplus of inventory results in price fluctuations that may not be beneficial to the organization.
With Lean thinking, the process of manufacturing or managing product development is completely customer driven with the focus on the needs of the customer and the advantage to the customer if competitive advantage is foremost.
The culture of an organization, according to Sayer and Williams (2007), must value individual creativity and empowerment to secure a satisfied customer base. Lean thinking eliminates the traditional hierarchy of corporate management and embodies individual work teams where individual creativity can flourish. Lean management also reduces the risk of occupational injury by virtue of scaling back wasted steps and movements of individual employees. Continual process improvement and quality assurance monitoring embody the importance of employee empowerment to secure this satisfied customer base.
Sayer and Williams (2007) underscore how Lean management systems are able to make continuous process improvements during projects or work floors by utilizing Six Sigma practices. Project management via team leaders periodically meet at their workstations or places of project development and participate in worksite analyses, value stream mapping interpretation and otherwise focus on project improvement. A project can be improved or redesigned mid-project if necessary, further boosting performance, reducing costs and increasing customer satisfaction.
Using impact and effort assessments, Six Sigma practitioners can determine what is the least effort required – in terms of costs, inputs, and employee needs – to have the greatest impact to a project and, ultimately, the satisfaction to the customer. Six Sigma uses data analysis, logical cause analysis, and other trending tools to determine value-added potentials to a project (p.97.)
Utilizing value stream mapping, an organization or manufacturer works toward the goal of flow, without stoppage, without broken equipment and an increase in multitasking (p. 41). Understanding flow and data will dictate where waste can be eliminated (p. 80).
Henry Ford, according to Sayer and Williams (2007), was the primary pioneer of Lean manufacturing concepts. Given the technology of his day, Ford was able to increase the quality of his cars at a reduced cost to the purchasers by managing and reducing waste at his manufacturing plant (p. 17). Ford understood the value-added effects of less waste of time and effort would have on his employees and his customers (p.17). Ford understood his plant should not waste space for production, not waste the time his employees took to move about workstations or between workstations, and have the necessary tools to do the job but without excess implements that might go unused (p.44).
According to Sayer and Williams (2007), Lean thinking requires a corporate or organizational culture of quality. The Toyota manufacturing system uses Lean thinking as a new paradigm of manufacturing excellence, relying on continuous improvement and thinking where everyone is a problem solver. Toyota applies “Just in Time” concepts to Lean manufacturing, where the right part is assembled by the right person at the right time (p. 35).
Relying on elimination of waste as its goal, Lean thinking demands the right combination of quality and service. “The customer is willing to give you their money for your product or service only when they believe it’s a fair exchange of value,” (Sayer and Williams, 2007, p.14).
The customer ultimately has a need for a particular product or service and sets the tone for meeting that need and defines the purpose of the product development or production. According to Sayer and Williams, (2007), it is imperative to identify who the customer is and to determine what the customer considers valuable in order to apply Lean concepts to an organization (p. 28).
All of these concepts require constant data gathering; the tallying up of effort, process distribution, causation of outcomes, and work sampling. According to Sayer and Williams (2007), data, portrayed in a diagrammatic visual aid such as a Scatter Plot, provides conclusions and predictions about what can happen next (p. 185). Pareto Charting allows a visual representation of where are actual costs (p. 183). Lean thinking is about constant evaluation of data.
Lean concepts cannot be adopted by an organization without development of a culture of trust and respect. These values must be demonstrated toward employees as well as customers. In order for management to go beyond stated or implied principles, they must demonstrate trust and respect toward employees. According to Sayer and Williams (2007), fundamental applications of Lean corporate values are demonstrated when the organization fosters “personal safety, employee security, challenges and engages employees, celebrates wins, offers continuous growth and education, exercises effective communication” (p. 215).
Lean thinking is not limited to manufacturing cars or widgets. As Sayer and Williams (2007) point out, “The future of Lean across all industries are limitless” (p. 311). As Lean thinking is seen as not the next gimmick of business practice but the future of business practices, Lean practices will be seen in industries such as health care, engineering, construction, and other industries wishing to increase performance and decrease costs to achieve customer satisfaction.
In the field of health care, for example, Lean practices result in reduced errors, reduced waiting times, increased staff productivity and increased patient education (p. 310).
Lean practices are seen already as a method to eliminate waste, reduce cost, and those values translate to customer satisfaction in almost every industry. Lean practices have been put into place by industry leaders many years before the term ‘Lean’ was coined. Lean practices are the answer to reduced overproduction, reduced wait times, fewer steps between workstations and reduced transport times.
Sayer, N. and Williams, B (March 2007). Lean for dummies. Indianapolis,
Indiana: Wiley Publishing Inc.