What is Lean Management: How to implement it

What is Lean Management? Production management is a complex task that requires considerable costs and resources. To make the process as efficient as possible, businesses use different approaches. Lean management is one of them.

Let’s see what this approach is, how it is implemented and how it will help the manufacturer.

What is Lean Management?

Lean management is…

…more of a philosophy than a technique that implies a lean approach to manufacturing processes. In short and to the point, it means cutting costs and saving resources with better results.

The bottom line is that this approach does not have any sets of rules or practices – it is based only on specific techniques. This tool helps to identify hidden losses in time and eliminate them. As a result, costs are reduced and team efficiency is increased.

In general, whatever it is called – lean production, thinking, management, approach, even transformation. It has been labeled appropriately in various disciplines, from lean construction and lean healthcare to lean software development and even lean government. The conclusion from all this is that the Lean method is applicable almost everywhere and is suitable for any areas and directions.

Where did it come from and how does it work

The principle, by the way, was founded in the 1950s by Toyota. There it was introduced by Taiichi Ohno, an engineer who later became chairman of the board of directors. He developed his own production system and identified the types of losses in it. There are 7 in total and they are as follows:

1. Overproductionis when a company produces more than it can sell. By the way, Taiichi Ohno considered him the main type of loss, due to which the rest arose.
2. Large stocks, surplus. In the modern interpretation, these are unrealized projects, as well as unused materials and resources. For example, unpublished texts, unused code, or unapproved image layout.
3. Unnecessary functionality– here we mean those options and capabilities that are present in a product or service, but at the same time they are not used by end users. For me, this is, say, the third camera in a smartphone.
4. Expectations and delays– all those moments where the team has to wait for the decision of others to continue the business. For example, when a project is submitted for approval or a designer/programmer/text editor is waiting for revisions.
5. Defects and marriage– their elimination requires resources and time, so it is better to monitor the quality of work from the initial stages. In some cases, of course, things cannot do without errors, but these are rather some exceptions.
6. Re-learning or unnecessary processing steps– this occurs if one person constantly transfers responsibilities to others. After all, they have to spend time every time to get to the bottom of the matter, and this reduces efficiency. Or when a newcomer is invited to the team in the middle of the development of the project, and he also needs to be given time to understand his tasks.
7. Irregular movement– this implies both unnecessary transportation and constant switching between tasks. Examples – when materials are not delivered between departments promptly, a project or part of it is transferred to another for work, several projects are assigned to an employee at once, and he constantly has to switch.

Later, Jeffrey Liker, who conducted research on the Toyota Production System, identified another, eighth type of waste – this is the unrealized creative potential of employees . This happens if a person is treated not as a person, but as a resource. As a result, he loses interest, and the efficiency of the processes performed decreases.

In general, these losses are the base, and the whole system works to eliminate them. But how – it’s up to you, depending on the chosen concept and the tools involved.

Benefits of Lean Management

There are several main advantages from the introduction of such a methodology in the management system:

1. Saving resources. If you eliminate all types of losses, then in the end you can significantly reduce costs, automate processes, remove unnecessary functions and eliminate unnecessary steps.
2. Increasing employee engagement. If you reduce the waiting time and eliminate the excess, people will be convinced of the effectiveness of the system and become more interested in the work.
3. Improving product quality. The system helps to identify and eliminate errors in projects.
4. Productivity growth. If you simplify business processes, reduce the time to complete tasks, and implement a KPI system, it becomes easier to evaluate the performance of employees.

Principles of implementing Lean management in a company

At one time, Toyota introduced 14 principles of the production system. Based on them, the leaders were able to establish production and become leaders in the car market. Now they have been somewhat transformed and are changing depending on the specific field of activity. But one thing remains unchanged – these are the values ​​that manufacturers are guided by. Here they are:

• Elimination of losses . All types of losses should be avoided. How to do it? Find out if the action brings value, improves quality, brings profit and saves time. If not, then you have a “loss”.
• Employee training . To create a quality product, the team must constantly learn something new. And the responsibility of management is to provide an opportunity for learning, acquiring new skills and knowledge.
• Continuous production . It is important that there are fewer “downtimes” in the work of the team. Even so, “just in time” is the basic principle of this methodology. Therefore, the sooner an employee completes his work, the sooner he will receive feedback and make changes faster.
• Teambuilding . In addition to gaining knowledge, employees must also unite, work together and understand the value of the company’s product. It is important to trust employees and value their contributions.
• Exclusion of defects . The focus of the team should be on quality and the absence of any defects.
• Tracking overall progress. Team members must understand their tasks and see overall progress. Therefore, up-to-date information should always be available to all participants.

The very first, of course, Lean-management used Toyota. However, other large companies such as Boeing, Lenovo, Jacobs Equipment Company (Danaher), Unior, Volvo and many others successfully introduced the technique behind them. To this day, many organizations continue to use this method and improve production efficiency.

Ways to implement Lean Management

There are a lot of ways in which you can set up production and introduce Lean methodology into it.

Tools and concepts

First, let’s talk about specific concepts and techniques with which you can adhere to the values ​​​​of lean management and eliminate waste.

• Kaizen is one of the main production concepts, a kind of Japanese culture, philosophy or practice. Its main principle is continuous improvement. In business, it involves the continuous improvement of processes and activities, employees and managers. At the same time, it is important to establish production without losses, which is adjacent to Lean-management.

• Kanban is a management technique that appeared during the development of lean management, that is, in Toyota. Now it is rather a convenient way of dividing responsibilities, actively used in modern companies. More details about the methodology, by the way, can be read in a separate article .
• KPI is a system that allows you to set key performance metrics for a specific task. It helps to analyze the main activities of the company and evaluate their effectiveness. Additionally, it allows you to stimulate employees.
• Poka Yoke, “bye-yoke” . It is a tool for preventing errors, namely the development of various devices or procedures to eliminate defects in production. It is sometimes referred to as the “zero error principle” or “fool-proof”. Developed in the 1960s by Japanese engineer Shigeo Shingo, who also worked on the Toyota Production System.

• SMART is a goal setting method based on 5 principles in accordance with the letters from the acronym. Allows you to set an accurate, realistic and measurable goal. You can learn more about it in another article .
• SMED – Single Minute Exchange of Dies, translates as “quick change of dies” or “quick changeover”. Another concept, one of the best, allows you to manage individual projects or even enterprises. At the moment it is one of the best project management tools. It involves a quick switch between production stages, as well as a reduction in financial and time costs during the creation and storage of products.
• 5S is a workplace organization system that includes 5 main steps: seiri, or Sort – sorting things into necessary and unnecessary; seiton, or Set in order – the arrangement and storage of things in a strict order; seiso, or Shine – keeping the workplace clean; seiketsu, or Standardize – the establishment of norms and rules; shitsuke, or Sustain – improvement and self-discipline. For this concept, it is important that all employees of the company follow the established steps – from the cleaner to the head.

Applications and services

Now we will talk about specific programs and services that will be useful in implementing the principles of Lean management in your company.

1. LeanKitis a program focused specifically on performing Lean management tasks based on the kanban method. The functionality is very thoughtful, the deadlines are displayed clearly, plus it is convenient to control the performance of duties by other employees. Those who wish will be able to try out the program, as there is a trial period of 30 days. Then you have to pay from $ 19 per month, depending on the chosen tariff.
2. Kanbanizeis another very simple and effective tool based on the kanban method. Includes analytics tools and the ability to expand the parameters of the boards at your discretion. There is a trial period for 30 days, then using the service will cost from $149-179 per month (this is for 15 users).
3. Worksectionis a Ukrainian product based on the same kanban method and Gantt charts . There is everything for convenient project management and compilation of several types of reports. It clearly shows where the task is idle and who is responsible for it. There is a free plan with little functionality. If you need more, you will have to pay from $29 per month, depending on the option you choose.
4. Jirais a good, visual tool, again on kanban. It is possible to prioritize, link a task to a specific category and track the completion of duties on different versions of the project in one place. Plus, there is a mobile application that can be downloaded directly from the App Store and Google Play online markets. There is a free version with support for up to 10 users; with more employees, you need to pay from $7.5 per month with a 7-day trial version.
5. Trello is the most popular tool, very simple and at the same time effective. By the way, Jira and Trello have the same developer. There is also a mobile application, quite convenient and well-designed. There is integration with Microsoft services like Dropbox and Teams, as well as with Google Drive. They didn’t go far from their brother in terms of prices – a free version for 10 boards, and paid from $ 5 per user per month.

Useful reading on the topic

If you want to delve deeper into the topic of lean manufacturing, I advise you to read the following books:

• Michael George. “Lean Six Sigma in Service Industry” . The author delves into these principles and gives many life examples (of which the book mainly consists). And he also considers the principles of introducing these techniques into the work of the company, specifically in the service sector. Plus, he lists the main difficulties associated with such processes.
• James P. Womack and Daniel Jones. “Lean Manufacturing: How to Eliminate Waste and Make Your Company Prosper” and “Selling Products and Services Using the Lean Method” . The first book became a bestseller – it is quite fresh, the information in it is relevant. The second came out earlier and has a relatively less practical focus. However, both will be useful, because their authors know firsthand about the basics and pitfalls of the lean management system.
• Shigeo Shingo. “A Study of the Toyota Production System from a Manufacturing Organization Perspective” . The author is the same person who developed and perfected the Poka Yoke, SMED, and Fool-Proof methods. Since he used to run the Toyota car company, the examples in the book are based on it. However, he simultaneously considers the features of introducing individual elements of its production system into any other structure, so the book will be extremely useful to anyone who plans to master Lean management.
• Geoffrey Liker. “The Tao of Toyota: 14 Management Principles for the World’s Leading Company” . Those same 14 principles on which the production process of the Japanese automaker was based. By the way, the author is the same person who singled out the eighth type of losses in the form of unrealized creative potential of the company’s employees. For 20 years, he made observations, studied the philosophy of the company, looked at the development of employees and singled out the most successful cases.
• Raju Navi, Prabhu Jaideep. Lean innovation. Smart Cost Technologies” . This book can be called a collection of the main provisions, since the authors consider the basic principles of lean manufacturing, while each of them leads to visual cases.

Lean management is interesting and effective, it helps to reduce costs and minimize losses, motivate employees and give them a clear picture of how the project is developing.