The Key Lean Thinking Principles

By Eirian Lewis, TEAL Consulting Ltd

In ‘Lean Thinking’ (Womack and Jones, 1996) five Lean principles were put forward as a framework to be used by an organisation to implement Lean Thinking. A key initial premise is to recognise that only a small fraction of the total time and effort when producing a product or delivering a service actually adds value for the end customer. It is therefore critical to clearly define value for a specific product or service from the end customer’s perspective, so that all the non-value activities - or waste - can be targeted for removal step by step.

Womack and Jones’ five principles are:  

1. Specify what creates value from the customers perspective Specify what creates value from the customers perspective
2. Identify all steps across the whole value stream Identify all steps across the whole value stream
3.  Make those actions that create value flow Make those actions that create value flow
4. Only make what is pulled by the customer just-in-time Only make what is pulled by the customer just-in-time 
5. Strive for perfection by continually removing successive layers of waste

Few services are provided by one function alone, so that waste removal has to be pursued throughout the whole ‘value stream’ – the entire set of activities across all the entities involved in jointly delivering the service. New relationships are required to eliminate waste and to effectively manage the value stream as a whole. Instead of managing the workload through successive departments, processes need to flow through all the value adding steps without interruption, using the toolbox of Lean techniques to successively remove the obstacles to flow to meet the demand from the end customer.

Removing wasted time and effort represents the biggest opportunity for performance improvement and enabling a greater focus on creating value.

Lean places greater emphasis on wasteful activity and in line with this, Toyota identified seven deadly wastes related to activity rather than design and implementation: transportation issues, inventory control issues, unnecessary movement of persons or equipment, time management, overproducing concerns, over-processing, and errors. Significant costs may be attached to each of these types of waste. As more and more layers of waste become visible and the process continues every action needs to add value for the end customer.

As Lean Thinking contends services must think strategically beyond its own boundaries. Because value streams flow across several departments and functions within an organisation, it needs to be organised around its key value streams. This includes enhancing the value delivered by internal service and back office operations … Finance, Human Resources, Legal and Compliance, Customer Service, Information Technology, Marketing, Facilities Management, etc.

Lean Thinking principles can be applied to any organisation in any sector. Although lean’s origins are largely from an automotive manufacturing environment, the principles and techniques are been transferred to many sectors, often with little adaptation. Despite scepticism by many that techniques and philosophies designed in a manufacturing context apply elsewhere, sectors such as distribution, housing, construction, healthcare, financial services, and other public sector services have all begun to implement Lean ideas in recent years.

Irrespective of the sector you work in, Lean is rooted in two key principles – "continuous improvement" and "respect for people". The "continuous improve-ment" principle embodies the tools and methods used to improve productivity and reduce costs. The "respect for people" principle embodies leadership behaviours and business practices that must be consistent with efforts to eliminate waste and create value for end-use customers. Customer Service, Information Technology, Marketing, Facilities Management, etc.

What is Lean Thinking?

Lean Thinking Origins
By Eirian Lewis, TEAL Consulting Ltd

The ideas behind what is now termed Lean Thinking can be linked to several sources, including management thinkers such as W. Edwards Deming. Of particular note are the ideas originally developed in Toyota’s post Second World War manufacturing operations – known as the Toyota Production System – under the guidance of its chief engineer, Taiichi Ohno. 

The term ‘lean’ was popularised in the seminal book ‘The Machine that Changed the World’ (Womack, Jones and Roos, 1990), which clearly illustrated – for the first time – the significant performance gap between the Japanese and western automotive industries. It described the key elements accounting for this superior performance as Lean production – ‘lean’ because Japanese business methods used less of everything – human effort, capital investment, facilities, inventories and time - in manufacturing, product development, parts supply and customer relations.

“All we are doing is looking at a time line from the moment the customer gives us an order to the point when we collect the cash. And we are reducing that time line by removing the non-value added waste.”

Taiichi Ohno, 

Toyota Production System 1978

Transforming Business Improvement through Knowledge Transfer

Since opening its doors in 2005 the Lean Academy's approach to business improvement has been based on the development of long term partnerships. Working with companies to develop the knowledge base required to ensure that the Continuous Improvement initiatives that are undertaken are built on solid ground are success to date is based not on what "we do to you" but on what "we do with you". This simple but critical difference is the reason we are so successful in our field.

The simplest approach to Continuous Improvement from the perspective of the outside body is to come into the business, be told where the perceived short comings are take the required remedial actions and go. This approach is short sighted and unsustainable.

The Lean Academy's approach is to join with the business, work together to establish the actual issues and not the perceived that are affecting the company, then work together as a team to solve these problems ensure that there is a robust transfer of knowledge thereby producing sustainable results.

This approach has been shown to work across all sectors of business from Manufacturing to Construction the Health Service and now into Retail, HR and Sales.