As a self-confessed Continuous Improvement geek, I’m always banging-on about Lean principles and sharing examples of Lean in action wherever I go.
There are some awe inspiring organisations around the world that demonstrate the power of lean and raise the standards of ‘what good looks like’. What does it mean to be a truly Lean Business? Does it mean that they’re ‘skinny’? No – they are just striving to become better each day.
A Lean Business is one that embraces the Continuous Improvement spirit by maximising value for its customers whilst minimising wasteful activities.
Some Key Characteristics of a Lean Business include…
PROCESS OPTIMISATION AS A WHOLE
Lean Businesses look to streamline the entire system of activities and processes that take place in their organisation in order to deliver the end result to the customer. Traditionally businesses only look to improve individual processes or local components rather than an entire value-stream. Lean provides a mechanism to make a wider impact through tools such as Value Stream Mapping.
They look at all activities that the customer isn’t directly paying for as ‘waste’ – this is a very harsh perspective but the results are transformational when you begin to strip out the non-value adding activities. At the centre of Lean is the identification, removing and prevention of waste to reduce duplication, errors, over-processing, delays, inventory and rework.
DATA DRIVEN DECISION MAKING
There is heavy use of data to identify trends, future insights and inform decision making. Data is part of the culture and every decision made is based on strong evidence. Many companies conduct regular performance huddles to enable data analysis and action plan development as a team.
The ‘voice of the customer’ is at the heart of the Lean approach. Everything is driven by customer requirements as it is the customer that defines what quality and value is. Market growth and return on investment are reliant on customers, so it makes sense to make them the focal point of all business decisions.
The ‘learn by doing’ approach is the epitome of Lean Six Sigma, originating from the Toyota Way where Lean Manufacturing was extensively developed. Everyone using the same language, tools and principles creates a learning culture where knowledge can be shared and capabilities developed.
MAXIMISING HUMAN POTENTIAL
Lean companies optimise their people’s skill sets and drive productivity through purposeful activity, reduced waste and transparency of data.
DEMAND AND CAPACITY USING JUST-IN-TIME (JIT)
They adopt a strategy and planning system where the required amount of materials or services are available when needed; thereby eradicating unnecessary waste. The JIT system is solely driven by customer demand.
Lean companies have built-in flexibility within their business models and processes. They have the ability to react to changes in customer demand as we know that customer expectations and the external landscape are forever changing. Adaptability is key to survival.
Keeping it simple is the name of the game. Lean businesses are always rationalising their process activities to ensure simplicity and avoidance of unnecessary complexities. Adding complexity always results in more cost.
Visual management is a key attribute of a Lean Company, providing visual aids to drive behaviour change and prompt action. Visualisation is used to spot problems early and maintain operational flow.
Lean leaders invest time in their teams to coach improvements and sponsor changes. They promote a Continuous Improvement culture and lead by example, demonstrating Lean principles in their actions and decisions.
TEAM BASED PROBLEM SOLVING
Lean Companies empower their front line teams to solve their own operational problems. In a Lean Business everyone will spend time on process improvement daily. Ownership of process improvement is the key to success for any organisation.
CONTINUOUS IMPROVEMENT (CI) CULTURE
Driving a CI culture where everyone understands and strives for continual improvements is what makes Lean Companies stand out. Their teams challenge the status quo and look for ways to do things better.
Are these common practices in your business? From our experience, the Lean approach works better when applied across the whole business as an entire system, and when it is the vision of the leadership. However, every great journey begins with a small step. Start with one of these Lean principles and the results will help to spread that Lean magic.