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What is Lean Management and How to implement it?

What is Lean Management and How to implement it?

Table of Contents

The practice of lean management is a strategy for increasing a firm’s productivity by managing and arranging operations.

This post will discover all the answers to your queries regarding Lean Management.

The definition of Lean Management

Before you get into what is Lean Management, you should understand that the goal of Lean is to improve work processes, workforce, and targets continuously.

Instead of controlling every stop in the work process, or having all power, Lean management promotes everyone in the organization to be leaderships and responsible for everything happens.

There are two Lean methodologies:

  • Human respect
  • Never-ending improvements

After all, an excellent concept can come from all levels of the operating apparatus. Lean encourages people doing the work to provide suggestions.

Today, Lean management is a common practice in several sectors. However, Toyota Production System is the one who created it 70 years ago.

What is Lean Management and How to implement it?

How was Lean born?

Toyota set out to reduce procedures that did not add much or no value to the finished product in the late 1940s, when they began developing Lean manufacturing.

Thanks to Lean, they gained much productivity, cycle time, efficiency, cost-effectiveness.

The distinctive influence of Lean rules has expanded it across many sectors and developed into five basic principles, according to the Lean Management Institute.

In his 1988 paper “Triumph of the Lean Production System,” John Krafcik (currently Google’s CEO of Waymo’s self-driving car project) coined the term Lean.

The Lean software development: An Agile Toolkit (2003) was written by Mary and Tom Poppendieck. The book states how to follow the Lean methodology’s fundamental concepts for software creation. There are 7 principles used to build Lean. It didn’t start as popular, but it is outstanding common software development approach.

How to implement Lean

Lean’s goal is to reduce the development of product cycles and quickly determine if a certain business idea is feasible, from a commercial standpoint. This approach is used by government agencies, marketing experts, and other organizations.

Lean management wasn’t born in a day. It is developing gradually as a result of numerous observations and people’s quest for further enhancement. And below are the five essential principles for implementing Lean management.

1. Find your Value

What is the goal of every business? To provide products or services that a client is prepared to pay for. If a company wants to achieve that goal, it must provide value based on its customers’ demands.

The value is in the issue you are attempting to handle for your customer. More precisely, in the aspect of what your customers want to actively pay, all activities, processes that don’t add value to the result are deemed wasteful.

So, determine what value you want to provide and then move on to the following move.

2. Value Stream Mapping

Let’s say you are a manufacturing firm. In this step, you should map your company’s operation. It must cover every action and person involved in bringing the final product to your customers. You’ll see which process sections offer no value in that way.

Value stream mapping is a Lean concept that helps identify where your value is created and how much of the work contributes or doesn’t contribute to it.

It’s not hard at all to spot which team is responsible for which process to measure, evaluate, and improve that process after completing your value stream mapping. This broad perspective will allow you to identify steps that aren’t delivering any value and get rid of them.

What is Lean Management and How to implement it?

3. Build a non-stop Workflow

After checking on the value stream, you must ensure that each team’s process runs smoothly. This step may take some time.

Cross-functional collaboration is often required while developing a product or service. Bottlenecks and disruptions can happen suddenly. You may easily detect and remove process barriers by breaking the process into smaller parts and checking the whole workflow.

4. Build a Pull System

A predictable workflow makes your team complete work activities more quickly and effortlessly. However, you must use a pull system with Lean management to achieve a consistent workflow.

In this approach, the task is only pulled if it’s necessary. You can better use your resources and only send products/services when they are truly required.

For instance, you go to a pizza restaurant and order a pizza in a restaurant. The baker takes your order, begins preparing the pizza, and doesn’t make many dishes in advance cause there is no actual order for them.

5. Non-stop Improvement

Now, you may build your own Lean management system in place. However, don’t underrate the most and last essential step.

The system you build isn’t stagnant and isolated. Issues might happen at any stages. This is why you must ensure that everyone who works on all levels is committed to continuously enhancing the work.

You can encourage continuous improvement in many ways. Each team can have a daily stand-up meeting to take a look at what has been accomplished, what should be done, and any challenges—an easy method to continue improving daily.

The Lean Management Tools

Lean tools are frequently referred to as learning and testing solutions. They’re adopted and carried out in a continuous development process by staff. There are different tools, but here are a few examples:

  • To improve the efficiency of their operations, managers should implement the 5S method (clear, tidy, clean, organize, and rigorous);
  • The Six Sigma approach for increasing process quality and efficiency is a method of continuous improvement;
  • Visual management to communicate information and solve issues;
  • The Kaizen method of continuous process improvement;
  • The SMED technique for shortening series change time;
  • To optimize inventory management, use the Kanban approach;
  • The Value Stream Mapping (VSM) approach is used to analyze processes and identify challenges;

Kaizen 5S

The 5S method is a fantastic approach to managing waste and enhancing profits. The letter “S” signifies the words “straighten,” “sort,” “standardize,” “shine,” and “sustain.” It’s a translation of Japanese terms: seiton, seiri, seiketsu, seiso, and shitsuke.

These words characterize strategies for maximizing work efficiency. For example, keeping track of and storing the used items, maintaining the objects and space, and establishing a new arrangement.

The 5S framework has become a key business tool and a critical driving force for Kaizen. The 5 Steps are as follows:

  • Sort: ​​Tidy up and categorize what is essential and non-essential in the area.
  • Straighten: Arrange things, so they are ready and accessible when needed. Mark a location for each item so that anyone can find them and return them as soon as the task is done.
  • Shine: On a regular basis, maintain standards and discover faults on time by cleaning the workplace and equipment.
  • Standardize: Check the first three of the 5S regularly to ensure that they are operating properly, and use conventional methods to check the Gemba.
  • Sustain: Keep the guidelines to preserve the quality and continuously enhance daily.

What is Lean Management and How to implement it?

Kanban

To summarize, one of the most efficient waste reduction strategies is using a kanban system. In 1952, Taiichi Ohno established a kanban procedure at Toyota to improve and maintain high production levels.

Later, Kanban was recognized as a helpful tool for integrating all aspects of a production process. It’s also an excellent method to promote development.

One of the primary advantages of the kanban technique is the ability to establish a work-in-progress limit. It allows you to avoid putting pressure on your manufacturing system by avoiding overloading it.

The “to do” – “doing” – “done” paradigm of the Kanban method quickly became a standard approach to project management and control processes on the Internet. Kanbanchi is one of several tools that implement the Kanban algorithm.

It’s critical to adhere to rigid guidelines of usage for a kanban system to be effective, according to Taiichi Ohno. Toyota, for example, has six simple rules. Keeping track of these regulations is an endless commitment. This ensures that the kanban system fulfills its purpose:

  • The following process will pick up the number of stuff indicated by the kanban at the previous one.
  • The process begins with goods being produced in the quantity and order specified by the kanban.
  • Without a kanban, no items are produced or moved.
  • Attach a kanban to each item.
  • Defective items are not transferred to the next stage. 100% defect-free products are the result.
  • Reducing the number of kanbans improves sensitivity.

Value Stream Mapping

Value stream mapping is a lean management method that may be used to map almost any value chain. It’s used to examine the current phase and develop future stages for a service or product from beginning to end. This technique is also helpful for:

  • Logistics
  • Supply Chain
  • Service-Related Industries
  • Healthcare
  • Software Development
  • Product Development
  • Administrative or Office Processes

The classic symbols used in a value stream map are standard icons to depict items and processes. To make the best VSM, draw it on A3 paper using a pencil. Because you’ll be making a lot of frequent modifications and corrections, this is the most effective method.

In fact, VSM is a relatively new tool in the TPS toolbox. Even in the late 1990s, these methods were mainly unknown outside of Toyota. Later, John Shook and Mike Rother collaborated on the book “Learning to See,” published by the Lean Enterprise Institute. This is what allowed for broader usage of the content and information flow beyond Toyota.

On the other hand, value stream mapping is a flexible tool that allows us to collect all of the data in one location using methods like process mapping or others.

Six Sigma

Definitely, sigma is a mathematical term that refers to process deviance from perfection. Six Sigma is a management practice focused on achieving and sustaining continuous improvements in various processes, similar to Kaizen. Bill Smith first used the phrase in 1986 at Motorola.

Six Sigma, unlike Kaizen, focuses on improving the quality of the completed product by finding and eliminating sources of faults. Six Sigma aims to reduce defects to zero using statistical analysis.

A sigma rating indicates the maturity of a production process by indicating how many defect-free products it generates. Companies must establish a suitable sigma level for each of their most vital functions and strive to meet these goals.

The DMAIC improvement cycle is the primary tool for executing Six Sigma projects. The acronym DMAIC stands for “Define, Measure, Analyze, Improve, and Control,” they are the five phases of the process. All functions must be completed in sequence and always follow the same pattern.

Businesses always use DMAIC method – a data-driven improvement cycle to improve, optimize, and stabilize business processes and designs. The five stages are not limited to Six Sigma. As a result, they may be used as the framework for various improvement programs.

The Six Sigma concept

Sustained quality improvement requires the entire organization’s efforts, especially from top management.

The production and business processes have characteristics that may be measured, analyzed, controlled, and improved.

Continuous efforts to establish and maintain consistent process outputs (e.g., reduce process variation) are critical for commercial success.

Six Sigma also has the following quality-improvement projects as part of its standard procedure:

  • A commitment to using verifiable data and statistical techniques over assumptions and guesswork in making judgments.
  • The development of management leadership and support is emphasized.
  • A firm focus on obtaining measurable and quantifiable financial returns from any Six Sigma project.

Over 60% of organizations with a Fortune 500 status began applying Six Sigma in the late 1990s. As a result of implementing Six Sigma, Motorola has achieved $17 billion in savings since 2006.

In recent years, Six Sigma methods have been joined with lean production to create the Lean Six Sigma method.

As a result, the Lean Six Sigma technique includes both Six Sigma and lean production, focusing on variation and design, process flow and waste concerns as additional disciplines intended to improve the company and functional efficiency.

The advantages of Lean Management

The continued prevalence of the Lean ideals is since they really concentrate on improving all elements of a business process, from top to bottom.

There are several key advantages for managers.

  • Focus: Adopting the Lean methodology may prevent wasting time and resources. As a result, your employees will be concentrated on activities that provide value.
  • Improving productivity & efficiency: Employees that are focused on delivering value will be more productive and efficient since unclear duties won’t sidetrack them.
  • Smarter process: If you use a pull system, you’ll be able to generate business only if there is a real need. This is the next point.
  • Resources should be more efficiently used: When your output is based on actual need, you may only use the exact amount of resources needed.

Because of this, your organization (team) will be much more adaptable and agile in responding to customers’ needs. In the end, Lean management ideas will allow you to establish a more stable production system (Lean system) with a better probability of improving overall performance.

Conclusion

Lean management is more of a handbook for establishing a solid organization that changes with time and aids in the identification of genuine concerns and their solution.

As a result, your firm and its employees will become more adaptable and quickly react to consumer demands. Lean Management principles will assist you in establishing a solid manufacturing process that will enhance your company’s overall performance.

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