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What is LEAN? - Part 6: How to implement Lean?

Tags: lean

Implementing Lean might be compared to an individual’s decision to improve his budget. You could earn more or you could save on unnecessary things. Earning more might increase the budget, but focusing spending on value is the more sustainable strategy for long term growth. It is not the dinner with your wife that ruins your budget but the never used stuff in your wardrobe. Same thing in business.

Many companies try and fail by focusing on short-term cost cutting or short-term sales to improve the overall financial situation. In Lean both strategies, ‘create value’ and ‘reduce waste’, go hand in hand. In order to optimize the opportunity for growth both has to be done consistently.

Five tips to become a LEAN Hero.

There are some tips to implement a Lean culture successfully and sustainably in your organization:

1. Increased performance requires LEAN thinking.

The first step is to recognize that only a small fraction of the total effort adds value from a customer’s perspective. With a clear definition of customer value for specific products or services all the non-value adding activities or waste can, step by step, be targeted for removal. Reducing them creates plenty of scope for improvement and innovation.

Typical value distribution and strategies of improvement© Picture by LEAN Train

2. Implementing Lean by LEAN Leadership.

Organizational change and improvement needs a vision. Vision and derived objectives require top-management attention and a system to deploy objectives all the way down the line. It is the managements’ responsibility to provide direction and structure and not to micro-manage on task level.

Leadership is giving direction so that the right things are done whereas management has to ensure that things are done right and on time. Defining customer value is leading the way towards a prioritization of the most valuable activities. Whereas waste reduction is ensuring that things are done right and in the most efficient manner.

Each person is the expert in his or her own job.Dr. Yoji Akao: Japanese planning specialist and developer of the strategic planning methodologies Hoshin Kanri and Quality Function Deployment.

When we generally assume that people are willing to do their best to achieve common goals and a desired outcome we are able to lead instead of micro-manage. As work styles are different, there might be different ways to come to a specific result. Being a leader means to define goals, prioritize tasks according to importance and timeframe and to coach task fulfillment. It does not help employees’ learning and efficiency if we do their tasks when they are stuck but we should assist in finding a way out of an impasse.

There are planning and management methods that help to cascade strategic goals down the line and to prevent micromanagement. One of them is Hoshin Kanri, Hoshin means ‘compass’/ ‘direction’, Kanri ‘management’/ ‘control’ often referred to as ‘Policy Deployment’ or ‘Management by Policy (MbP)’. It is a holistic quality-oriented management approach where all employees participate, from top down and from bottom up. Hoshin Kanri focuses on few but ambitious breakthrough goals and cascades this down the line whilst specific arrangements of how to achieve these goals are the responsibility of the next level. With this approach strategic goals get more and more detailed and the experience and ingenuity of the people is utilized.

Of course it is most effective if a whole organization practices Lean leadership. But also a manager of a business unit, department or a team can make a difference and create a best practice example of operational excellence by value orientation, waste reduction and Lean leadership.

3. Think beyond boundaries.

In some organizations it is harder to keep value and benefits of the end customer in mind. But every organization has a purpose and a mission. Even if the end customer is far away as this might be the case in big enterprises and in some administrative functions, there are stakeholders out there that want to experience the benefits of your work.

The value chain stretches across departments and functions within an organization. As the value stream flows in every single corner of an organization all functions can contribute to create value and the organization must be organized around the key values for its purpose. Think of an organization as a horizontal supply chain process instead of vertical departmental silos. Every function has its share in the process and every function is supplier of outputs that must be valuable for the next step, the next internal customer, in order to fulfill end customers’ needs and deliver benefits for them.

Delivering value across the whole organization© Picture by LEAN Train

4. Spread LEAN but start small.

When you have a promising management methodology at hand it might be tempting to implement it instantly within the whole organization. Don’t do it! Change is part of our lives, but within the workplace people's reaction to change can be unpredictable and irrational. What you need is a positive perception of change. This can be achieved if managed in the right way.

News and rumors about change can spread faster than a bush fire. Instead of beating around the bush it is useful to explain the Lean approach and what the organization expects out of it. Proper information and building trust is the foundation for a successful implementation of Lean. Wherever Lean is about to be implemented people should know before what it is, what it does and how it will affect their work life. Thus everybody should receive a basic training of Lean or information like in a roadshow to know what can be expected. As Lean is not a methodology to cut costs but to save resources like everybody’s time and energy this should be clearly stated within all information.

Once the decision to implement Lean has been made, the support of the top-management as well as involvement and training of the process owners is of utmost importance. If process management is already practiced within the organization process owners are those who have the best knowledge of a process within the value chain and the ultimate responsibility for the performance of that process. If process management is new to the company processes should be divided in value creating process steps. Those who are responsible for the execution and performance of a process are usually the process owners. This means that they have the role to ensure that a process has the resources needed for execution, its performance is measured with KPI’s and that it delivers upon agreed objectives.

Next thing is to define an area where process improvements have the most immediate effect but are also achievable. Where to start depends on the organization and their most pressing problems. However, it is advisable to improve one area of operation after another. Within the value chain processes are connected via input-output relations or, in other words, the downstream process is the customer of the upstream process. If for now supply management is the prior area of focus, process improvements should be within this field.

Which Lean tools can be used depends on the sector and the operational area of the specific process. Most important is that value-oriented objectives and requirements for this process are known. The quality of the process already benefits when those people who are performing this process go in for a proper examination of its deliverables, their value for the next steps and the input and output factors that influence quality.

5. Communicate roadmap and results.

Communication is as important for the success of a Lean initiative as training and continuous improvements in operations. Thus communication of the aims of the Lean initiative, their roadmap and gained results are crucial for People’s buy in. Particularly at the start of any Lean initiative it is important to realize quick wins and communicate those towards top-management, other process owners and the workforce.

While management will be more interested in facts and figures and the ROI of the improvements, people at the front lines want to know and how it effects their operational work. A good communication strategy along the Lean initiative increases significantly the willingness for change and improvement. The key is to give the stakeholders the information, training and tools needed to apply Lean and to celebrate and communicate results.

To win people’s understanding, participation and buy-in for change is equally important as the decision of the operational areas for the Lean projects and the application of the right Lean tools.

Lean organization, training and communication© Picture by LEAN Train

Read more about the concept of LEAN in our blog-series "What is LEAN?":

What is LEAN? Part 1: Concept and history of lean - The LEAN transformation.
What is LEAN? Part 2: The 5 principles - Create value and reduce waste.
What is LEAN? Part 3: Delivering value - Customers' value perception and how to deliver.
What is LEAN? Part 4: Delivering quality - Definitions of quality and ways to optimize it.
What is LEAN? Part 5: Reduce waste, gain efficiency - Identifying waste and improving operations.
What is LEAN? Part 6: How to implement Lean? - Successful Lean organization, training and commuinication.

This post first appeared on LEAN Train Blog | LEAN Train, please read the originial post: here

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What is LEAN? - Part 6: How to implement Lean?


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