Are you curious about the Lean Management Methodology but find it a bit overwhelming? No worries! Let’s break it down. We take a closer look at the basics of lean management itself and introduce you to six of the more popular methods, from Kanban to Kaizen. We’ll cover essential principles and introduce you to key methods, so you get a feeling for the real meaning of “lean”.
So what is the Lean Management Methodology?
The Lean Management Methodology is a management philosophy that originated from the production processes at Toyota in the 1950s. The goal is to maximize customer value while minimizing waste. Sounds easy, right? But what exactly does that mean? Well, let us explain it to you using a simple example: Imagine you are a pizza baker. Your customers want to get delicious pizza as quickly as possible, and you want to use as little effort as possible to make them happy. Lean Management would help you to identify the steps in your process that do not add value, such as unnecessary waiting times or unnecessary movements. By eliminating these wasteful activities, you can create more value for your customers and become the Lean Pizza Master!
“…Lean practices act as a basis for the effectiveness of processes and may optimizeoperational and administrative activities in public organizations” – study
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The 5 principles of Lean Management
Lean Management is based on 5 fundamental principles. These principles serve as the foundation for all Lean activities and help you to improve your processes continuously. Let’s take a closer look at these principles:
- Value: The first principle is to understand what your customer values. In our pizza example, your customers value a delicious, hot and, of course, affordable pizza. By focusing on the value your customer desires, you can tailor your processes to meet their needs. No more pineapple on pizza debates!
- Value stream: The second principle is to identify and understand the value stream, i.e. the sequence of steps that are necessary to create the product or service. In our pizza bakery, the value stream includes all activities from ordering the ingredients to delivering the finished pizza to the customer. By analyzing and optimizing this value stream, you can remove bottlenecks and unnecessary steps to deliver value to your customers faster and more efficiently.
- Flow: The third principle is to ensure that work processes flow smoothly. In our pizza example, this means that the individual steps in the process are well coordinated and that there are no unnecessary waiting times or interruptions. This way, you can ensure that the pizza is ready to be served to your hungry customers as quickly and smoothly as possible.
- Pull: The fourth principle is to produce only what the customer demands. This is also known as the “pull principle”. Instead of producing a large number of pizzas and hoping that they will be sold, you only start preparing a pizza when the customer has placed an order. This way, you can avoid overproduction and ensure that your resources are used efficiently.
- Perfection: The fifth and final principle is to strive for continuous improvement. This means that you are never completely satisfied with your current state, but always look for ways to make your processes and products even better. By constantly learning and optimizing, you can stay one step ahead of your competition and delight your customers with the best possible pizza experience.
Waste in Lean Management
One of the central concepts of Lean Management is the identification and elimination of waste. Waste can occur in various forms and is like the arch-nemesis of Lean Management. The 7 types of waste in Lean Management are:
1. Overproduction
Producing more than the customer demands. Your goal is to produce the right amount at the right time. Overproduction ties up your resources and can lead to unnecessary storage costs and a higher risk of producing defects.
2. Inventory
Having too much stock on hand. This ties up your capital and can hide other problems in your processes, such as long waiting times or overproduction.
3. Motion
Unnecessary movements of people. This waste can occur, for example, when your employees have to walk long distances to get the things they need or when they have to search for tools and materials. The goal is to minimize unnecessary movements to save time and energy.
4. Waiting times
Time is money, and in Lean Management, waiting is the enemy! Unnecessary waiting times between process steps can slow down your value stream and reduce your efficiency. By reducing waiting times, you can deliver value to your customers faster and improve your processes.
5. Transport
Unnecessary transportation of goods. Every time you move your pizza ingredients from one place to another, you not only incur costs but also the risk of damage or loss. The aim is to minimize unnecessary transport to save time, money and resources.
6. Defects
Defective products or services. Defects can lead to rework, customer complaints and, ultimately, the loss of value. Your goal is to identify the causes of defects and eliminate them at the root to ensure that you deliver high-quality products and services to your customers.
7. Overprocessing
Doing more than necessary. This can occur when you add features to your products that your customers do not value or when you perform unnecessary process steps. The aim is to streamline your processes and products so that they provide exactly the value your customers want and nothing more. By working on these 7 sources of waste, you can improve your processes, save costs and deliver more value to your customers.
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6 popular Lean Management methods
Now that we have covered the basics of the Lean Management Methodology, it’s time to take a look at real-life lean methods. We will introduce you to six popular Lean methods and show you how they work and when to use them. To keep it simple, we cover the basics of each method, so you get an overview of the variety of Lean management methods.
1. 5S method
5S is a simple Lean Management Methodology, but powerful tool to organize your workplace and improve efficiency. The name “5S” stands for five Japanese words, each beginning with the letter “S”, which describe the steps of the method. Let’s take a look at these steps:
- Step: Sort (Seiri)
The first step is to sort through all the items in your workplace and separate the necessary from the unnecessary. You can imagine it like cleaning out your closet. You only want to keep the clothes that you actually wear, the rest goes to the charity shop (or gets upcycled by your creative, trend-setting self). - Step: Set in order (Seiton)
Once you have sorted out the essential items, the next step is to arrange them in a well-organized manner. Everything should have its designated place, so that you and your colleagues can find it quickly and easily. You could imagine it like putting your pizza ingredients on your worktop in a way that makes it easy and fast to prepare your pizza. - Step: Shine (Seiso)
The next step is to clean and maintain your workplace regularly. A clean workplace not only looks nice, but it also helps to uncover problems, such as leaky faucets or broken tools, at an early stage. So, grab your mop and your duster and make your workplace shine! - Step: Standardize (Seiketsu)
Once you have sorted, arranged and cleaned, it is important to establish standards and work processes to maintain this improved state. Everyone in the team should follow the same rules, like using the same pizza recipe. This ensures that the improvements are sustainable. - Step: Sustain (Shitsuke)
The final step is to develop a discipline and culture that ensures that the 5S principles are followed continuously. This may require training and regular checks to ensure that the 5S method becomes a natural part of your daily work. Once you have mastered the 5S method, you will not only have a clean and well-organized workplace, but you will also improve efficiency and create a foundation for further Lean improvements.
2. Kaizen
Kaizen is not only a fun word to say, but also an incredibly powerful Lean Management Methodology. The term “Kaizen” comes from Japanese and can be translated as “change for the better” or “continuous improvement”. And that’s exactly what this method is all about. Kaizen is a philosophy that encourages all employees in a company to constantly look for ways to improve processes and work together to implement these improvements. It’s like having a whole army of improvement professionals in your company!
The 3 pillars of Kaizen
Kaizen is based on three fundamental pillars, which are essential for its success:
- Teamwork
The first pillar is teamwork. To implement Kaizen successfully, it is important that all employees work together as a team. By combining different perspectives and experiences, you can develop creative solutions and ensure that improvements are accepted and implemented by everyone. - Discipline
The second pillar is discipline. Implementing Kaizen requires discipline and commitment. It is important to set aside time for improvement activities regularly and to follow a structured approach to identify, test and implement new ideas. - Personal commitment
The third pillar is personal commitment. Each employee should be encouraged to contribute their ideas and actively participate in the improvement process. This can be achieved through training, regular feedback and the creation of an environment that promotes open communication and the sharing of ideas. With these three pillars, you can lay the foundation for a successful Kaizen culture in your company and unleash the full potential of your employees.
The Kaizen cycle
The implementation of Kaizen works according to a simple cycle, which consists of 6 steps:
- Step: Standardize processes
The first step is to establish standards for the process you want to improve. These standards serve as a reference point and help to identify deviations and problems. For example, you could establish a standard process for preparing your pizza to ensure that each pizza is consistently delicious. - Step: Observe and document
The next step is to observe the process and document how it is currently being carried out. This can help you to identify waste, bottlenecks, and opportunities for improvement. For example, you could observe how your employees prepare the pizza and document the individual process steps. - Step 3: Identify problems and waste
In the next step, you analyze the observed process to identify problems and waste. This can include, for example, unnecessary waiting times, overproduction, or defects in the product. By identifying these issues, you can prioritize your improvement efforts and focus on the most critical areas. - Step: Develop and test solutions
In this step, you and your team develop potential solutions to the identified problems. These solutions should be practical, cost-effective, and aimed at eliminating the root causes of the issues. Once you have developed your ideas, you can test them on a small scale to see if they work in practice. For example, you could test a new process for preparing the pizza in one section of your kitchen. - Step 5: Implement and measure
Once you have found a promising solution, you can implement it on a larger scale. Make sure to train your employees on the new process and provide them with the necessary resources. After implementation, it is essential to measure the effects of the improvement. This can be done by comparing key performance indicators (KPIs) such as the time it takes to prepare the pizza before and after the improvement. - Step 6: Standardize and continue
If the improvement has proven to be effective, you can integrate it into your standard process and establish it as a new standard. Make sure to update your documentation and provide training to ensure that all employees are familiar with the new way of working. After that, you can start the cycle again by looking for the next area of improvement. By following this continuous improvement cycle, you can make your processes more efficient, reduce waste, and create a culture of ongoing improvement. Congratulations, you are now a Kaizen master!
3. Value Stream Mapping (VSM)
Value Stream Mapping (VSM) is like a treasure map that helps you to discover hidden treasures in your processes. This Lean Management Methodology allows you to visualize and analyze the entire value stream of a product or service, from the customer’s request to the delivery of the final product. By creating a Value Stream Map, you can identify waste, bottlenecks, and opportunities for improvement, and develop a plan to make your value stream more efficient and customer-focused. A Value Stream Map typically includes the following elements:
- Customer demand
At the beginning of the value stream, you show the customer’s demand, for example, how many pizzas your customers order per day. - Process steps
You then map all the individual process steps that are necessary to meet this customer demand, from ordering the ingredients to baking and delivering the pizza. - Time and information flows
You also indicate the flow of time and information between the individual process steps. This helps you to understand how long it takes to complete a step and how information is passed from one point to another in the value stream. - Inventory
You also show the inventory levels at various points in the value stream. This can help you to identify where you have too much stock, which ties up your capital, or too little stock, which can lead to interruptions in the process. - Wait times and lead times
You also highlight waiting times between process steps and the total lead time from customer demand to product delivery. This can help you to uncover bottlenecks and identify opportunities to reduce waiting times and become faster and more responsive to customer needs. - Quality control points
You also mark points in the value stream where quality control takes place. This helps you to ensure that you deliver high-quality products to your customers (see also: Quality Gates). - Opportunities for improvement
Lastly, you indicate opportunities for improvement that you have identified during the mapping process. These could be things like eliminating unnecessary process steps, reducing waiting times, or improving the flow of information. By creating a Value Stream Map, you and your team can gain a comprehensive understanding of your value stream and work together to make it more efficient and effective.
4. Kanban
Kanban is not only a Lean Management Methodology, but also a visual management system that helps you to control your tasks and processes. The word “Kanban” comes from Japanese and can be translated as “signboard” or “visual card”. The core of the Kanban method is a Kanban board, which is a kind of task board that visually represents your workflow. A typical Kanban board consists of the following columns:
- To-do
This column shows all the tasks that still need to be done. For example, you could write down here all the pizza orders that have been received but have not yet been processed. - In progress
The next column shows the tasks that are currently being worked on. This gives you and your team an overview of the tasks that are in progress at the moment and helps to limit the work in progress, so that you can focus on completing tasks before taking on new ones. - Done
The last column shows the tasks that have already been completed. This allows you to track your progress and celebrate your achievements. You can imagine it like a wall of fame for your completed pizza orders.
How to use a Kanban board?
You can create your Kanban board on a physical board with cards or digitally with the help of software. Each task is represented by a card, which contains information about the task, such as a description, due date, and responsible person. You can move these cards from column to column as the status of the task changes. For example, when you start preparing a pizza, you move the corresponding card from the “To-do” column to the “In progress” column, and when the pizza is ready to be delivered, you move the card to the “Done” column. This visual representation of your workflow helps you to see at a glance which tasks are in progress, where there may be bottlenecks, and where you can improve your process. The Kanban method also includes principles such as limiting work in progress, making your process policies explicit, and continuously improving your process.
By following these principles and using a Kanban board, you can improve the flow of your work, increase your efficiency, and reduce stress and chaos. So, grab your Kanban board and get ready to bring more order and control into your work.
5. Poka-Yoke
“Poka-Yoke” is another fun Japanese term that can significantly improve your processes. It can be translated as “mistake-proofing” or “inadvertent error prevention”. The Poka-Yoke Lean Management Methodology aims to prevent errors and defects in your processes before they occur. This is achieved by implementing simple and effective measures that make it impossible or at least difficult to make mistakes. Let’s take a look at a few examples of Poka-Yoke in action:
Example 1: Shape coding
Shape coding means using the shape of a part to ensure that it is assembled correctly. For example, you could design your pizza trays and your pizza oven in such a way that the trays can only be inserted in one direction. This ensures that your employees cannot accidentally put the trays in the oven the wrong way, which could lead to burnt pizzas and unhappy customers.
Example 2: Count check
A count check means that you verify the number of items to ensure that nothing is missing. In your kitchen, you could use this method by having a checklist for all the ingredients of your pizzas. Before you start preparing a pizza, you or your employees can quickly check off the ingredients on the list to make sure that nothing is missing and that you don’t accidentally forget the delicious mozzarella.
Example 3: Color-coding
Color-coding means using colors to distinguish between different items or to indicate correct or incorrect positions. You could use color-coding by marking your pizza boxes with different colored stickers to indicate which pizzas are for delivery and which are for pickup. This helps to ensure that your customers receive their pizzas in the right way and that there are no mix-ups.
Example 4: Two-handed operation
Two-handed operation is a safety feature that requires two hands to be used simultaneously to perform a task. You could apply this to your pizza cutting machine by installing a mechanism that requires your employees to press buttons on both sides of the machine at the same time to activate the cutting blades. This way, you can prevent accidents and injuries by ensuring that the machine is only used when both hands are safely away from the blades. By implementing these and other Poka-Yoke measures, you can reduce the likelihood of errors and defects in your processes, improve the quality of your products and services, and save time and money that you would otherwise have to invest in rework or customer complaints.
6. PDCA cycle
The PDCA cycle is a fundamental Lean Management Methodology that stands for “Plan-Do-Check-Act” or “Plan-Do-Check-Adjust”. This method is like a compass that guides you through a continuous improvement process. The PDCA cycle consists of four interconnected steps:
- Plan: The first step is to plan the improvement. Here, you define the goal and the problem you want to solve. For example, your goal could be to reduce the delivery time of your pizzas, and the problem is that your delivery routes are not optimized. You also develop a plan of action, determine which measures you want to take, and set clear objectives and criteria to measure the success of your improvement.
- Do: The next step is to implement the plan. You and your team put the planned measures into action. For our example, this could mean that you test new delivery routes, assign drivers more efficiently, or use delivery optimization software. By implementing these measures, you can gather practical experience and data.
- Check: In the third step, you analyze and evaluate the results. You compare the actual results with the goals and criteria you set in the planning phase. In our example, you look at whether the new delivery routes have reduced the delivery time, whether your drivers are more efficient, and whether you have saved costs. By analyzing the results, you can identify successes, but also deviations and problems.
- Act: The last step is to derive conclusions from the evaluation and take appropriate actions. If the results meet your goals, you can standardize the new, improved process. In our example, this means that you establish the optimized delivery routes as the new standard and train your drivers accordingly. If the results do not meet your goals, you identify the causes of the deviations, learn from the experience, and develop new measures to further improve the process. This could involve refining the delivery routes, addressing driver issues, or considering other optimization options. By continuously repeating the PDCA cycle, you can ensure that your processes are constantly improving, and your company remains competitive and efficient.
Conclusion
We hope you now have a solid understanding of the basics of Lean Management Methodology, its principles, the seven types of waste, and the most important Lean methods. We hope that you not only found this information inspiring to try your own style of Lean Management. Remember, Lean Management is not just a set of tools and methods, but a mindset that focuses on continuous improvement, efficiency, and delivering value to your customers. So start small, and gradually integrate Lean principles and methods into your work and your organization. The path to becoming a Lean Management pro may be challenging at times, but the rewards in terms of improved processes, better quality, and satisfied customers are definitely worth it. So, go forth and may the Lean Management Methodology guide you to success!
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Book Recommendations
- “The Lean Startup” by Eric Ries
- “Lean Thinking” by James P. Womack and Daniel T. Jones
- “The Toyota Way” by Jeffrey K. Liker