Lean management is a business philosophy that aims to maximize customer value while minimizing waste. It is based on the principles of the Toyota Production System and has been adopted by many industries, such as project management, software development, construction and more.
Lean management can help businesses improve efficiency, quality, customer satisfaction and employee engagement. However, implementing lean principles is not easy and requires a clear vision, a systematic approach and a culture of continuous improvement. In this article, we will explore five steps for consistent lean operations, based on the insights from an Entrepreneur contributor.
Define Value from the Customer’s Perspective
The first step of lean management is to define value from the customer’s perspective. This means understanding what the customer needs and expects from the product or service, and how they measure its quality and performance. Value is not determined by the cost or features of the product, but by how well it solves the customer’s problem or satisfies their desire. By defining value from the customer’s perspective, businesses can focus on delivering what matters most to them and eliminate any activities that do not add value.
Map the Value Stream and Eliminate Waste
The second step of lean management is to map the value stream and eliminate waste. The value stream is the sequence of steps and processes that transform raw materials or inputs into finished products or outputs that deliver value to the customer. Mapping the value stream helps businesses identify all the activities involved in creating and delivering value, and evaluate their efficiency and effectiveness. Waste is anything that does not add value to the customer or consumes more resources than necessary. There are eight types of waste in lean management: defects, overproduction, waiting, non-utilized talent, transportation, inventory, motion and extra-processing. By eliminating waste, businesses can reduce costs, improve quality, increase speed and optimize resources.
Create Flow and Reduce Variations
The third step of lean management is to create flow and reduce variations. Flow is the smooth and uninterrupted movement of products or services through the value stream, without any delays, bottlenecks or interruptions. Flow ensures that value is delivered to the customer as quickly as possible, without any waste or inefficiency. Variations are any deviations or fluctuations in the quality or quantity of products or services, which can cause defects, rework, dissatisfaction or waste. By reducing variations, businesses can ensure consistent quality and performance, and meet customer expectations.
Establish Pull and Align Supply with Demand
The fourth step of lean management is to establish pull and align supply with demand. Pull is a system that triggers production or delivery only when there is a demand from the customer, rather than based on forecasts or schedules. Pull ensures that products or services are produced or delivered only when they are needed, and in the right quantity and quality. This reduces inventory, overproduction, waiting and waste. By aligning supply with demand, businesses can balance their capacity and resources with customer needs, and avoid underutilization or overutilization.
Pursue Continuous Improvement and Empower Employees
The fifth step of lean management is to pursue continuous improvement and empower employees. Continuous improvement is a mindset and a practice that seeks to constantly monitor, measure and improve the value stream and eliminate waste. Continuous improvement involves setting goals, collecting data, analyzing results, implementing changes and evaluating outcomes.
It also requires feedback from customers and employees to identify opportunities for improvement. Empowering employees means giving them the authority, responsibility and autonomy to make decisions, solve problems and implement improvements. Empowering employees fosters a culture of teamwork, innovation and accountability, which can improve productivity, quality and satisfaction.
