Lean methodology is a hot topic in the Stavanger region nowadays. Many businesses implement Lean in order to be more effective. This blog post is an introduction to Lean and its history.
The Lean methodology is Japanese and started with Toyota Production System (TPS). Eiji Toyoda was on a three-month trip to the US with the goal to learn from the production methods. Back in Japan, he and his colleague Taiichi Ohno realized that mass production would not work in Japan. Therefore the TPS system was born – this was later to be what we know as Lean. The big press lines, which produced car parts in the Western world, required a high economic of scale to be profitable. In Toyota the production was not high enough to defend this type of investment. They had to find other ways to be competitive; first they found a simple die-changing technique, which made them able to make smaller batches. In this process they found out two things: smaller batches reduced the inventory cost and production defects were detected fast (Jones, Womack, & Roos, 1990).
Today there is an overcapacity problem in most industries. Therefore many have recognized that a transition to Lean is appropriate in order to be more competitive. Lean is not just a way of working – but a way of thinking (Jones, Womack, & Roos, 1990). An important word in Lean is Muda, this means waste in Japanese. Waste is the activities, which do not create value. Originally there were seven wastes; overproduction, defects, unnecessary transport, waiting time, over-processing, movement, overstocking. Lean is about reducing the wastes.
In order to recognize waste, a starting point is to specify value for the customer. Why are they buying your product or service? When the value is determined, the value stream must be identified. A value stream is the set of actions or processes required to manufacture a product or service. After the steps of specifying value and mapping the value stream, the next step is to create a better flow. Many businesses work with batches and queues instead of flow. An example would be when you are sick, you first have an appointment with the doctor. When finished, the doctor has determined if you should be forwarded to a specialist. When you need to make a new appointment, the specialist will after examining you, need time to evaluate the test. This require waiting time, since medical equipment often is a scarce resource. Review of results could require an additional doctor or specialist appointment. If you can be treated with drugs you have to go the pharmacy, possibly queue again. This kind of flow is the opposite of Lean. In Lean context, all these steps would be organized in such as the wastes like waiting time and the movements were at a minimum level. (Womack & Jones, 1996)
“In short, Lean thinking is lean because it provides a way to do more and more with less and less – less human effort, less equipment, less time, and less space – while coming closer and closer to providing customers with exactly what they want.” (Womack & Jones, 1996, p. 15)
This statement is an ambitious goal for the Lean methodology, and sounds like something every business manager should do. But studies have shown that achieving the positive effects of Lean is hard in practice. Many of the failures are related to managers not adapting Lean thinking. Lean is not a time limited project – it is an ongoing process! But it is a challenge to change the culture towards Lean thinking. There is a saying that “Culture eats strategy for breakfast”, this illustrate how difficult it is to change peoples mindset and “way of doing”. The key to a successful implementation of Lean, is to not treat it as a time limited project, and to ensure that managers understand Lean and use it in the organization.
Womack, J. P., & Jones, D. T. (1996). Lean thinking: banish waste and create wealth in your corporation. New York: Simon & Schuster.
Jones, D. T., Womack, J. P., & Roos, D. (1990). The machine that changed the world. New York: Rawson Associates.