What is Lean?

Lean is an approach to business operations that was first developed in manufacturing and formalised in the Toyota Production System.  At its core is the question, “how to do this with the least overall waste?”  That means viewing the operation holistically and dividing work up to be the most efficient way of using time, money, effort and resources to achieve the overall results.

Waste is anything that doesn’t add value or is unproductive. Lean defines waste in one of seven ways:

• Transportation of materials and product
• Excess inventory
• Motion of the producer
• Waiting time
• Over-processing
• Over-production
• Defects

The benefits come from reducing waste  and

• Improve performance of the organisation’s processes
• Improve customer satisfaction
• Improve quality
• Reduce time wasted or waiting for something to happen
• Reduce inventory, over stocking or supply inconsistency
• Increase sales
• Improve financial performance of the organisation
• Improve working conditions, employee satisfaction and engagement

The lean approach is based on a five principles:

1. Specify product value from the customer’s view.
2. Identify all the steps for each product, cut steps that do not create value.
3. Put the value-creating steps occur in tight sequence
4. Let customers pull value from the next upstream activity.
5. begin the process again and continue the improvement.

Deceptively simple!

So why don’t all businesses use it? It requires a very disciplined way of managing and many managers seem to be trapped in the spiral of concentrating on today’s problems.  Take a step back and consider how  this approach could help you avoid tomorrow’s firefight.

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