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Lean Basics

Do you want more time to focus on what is important in your business? Do you have the curiosity to explore more efficient ways to manage operations so that you have the time to grow sales?  Lean Process Improvement will help you and your teams problem solve to free capacity to focus on strategic endeavors.

What is Lean? – Lean is about actively looking for wastes that crop up in our processes overtime, enhancing value from the perspective of our customers and involving the people who work in processes every day.

5 Lean Principle. Dan Jones & Jim Womack contend that by applying these  5 Lean Principles  to your operational processes, employees and business owners can improve their operations.

  1. Value
  2. Value Stream
  3. Flow
  4. Pull
  5. Perfection

Most importantly value must be defined by the customer, in that for any task the customer has to be willing to pay for the task (imagine a customer taking out a credit card and offering to pay for what you are doing right now!), the task must be transformative and it must be done right the first time!  Most tasks in our processes fail on at least one of these elements and are there for an opportunity to improve by eliminating the waste. 

 

Instead of focusing on process, Lean seeks to evaluate Value Streams, which is essentially the end-to-end process from when a customer first encounter’s your organization to when they have completed their transaction for a product or service.  By understanding the value stream, organizations can see the “path of the customer” through the organization – which is often disjointed, confusing, and too many points of contact – often times with conflicting information.  For small business owners, looking at value stream maps means assessing how customers are engaged, perhaps by reception or a website.  Are “buzz words” used that are confusing to customers?  Do you make it easy for customers to connect and make an appointment?

 

Flow, focuses on how you add-value as fast as possible to shorten the time period between 1st contact and payment/feedback or evaluation.  Flow in integral to small businesses as a method to manage cash-flow while providing speedy service to your customers.

 

Pull, looks to encourage small business owners to produce only what the upstream process or customer requires.  Rather than forecasting and producing in advance, which causes inventory build up.  Most organization are practically, a combination of push and pull.  The key here is to “look’ at the work you are doing.  Is there something that you are doing in advance, only to find out you overproduced or it wasn’t needed.

 

Perfection, as the word implies…constantly improving on your processes, learning from mistakes and evaluating performance with the aim of making the value streams work better from the customer perspective. This constant striving – a mindset  really – becomes imbedded in your everyday.

 

7 Wastes.  The acronym TIMWOOD, spells out the 7 wastes of:

  1. Transportation
  2. Inventory
  3. Motion
  4. Waiting
  5. Overproduction
  6. Over processing
  7. Defects

 

These wastes creep up in our processes, such that over time we don’t even notice them!  It becomes “The way we have always done it”.  Going on a “Waste Walk” with your employees can help you to “See” where there are areas for improvements that can help you streamline your processes.  Remember,….. never walk alone!  Waste walk with someone else to collaborate and ensure that a waste in one person/team’s process is not another person/team’s requirement.  E.g. financial forms come to mind here!

 

New wastes…. That are not so new….. include the following:

From the above list, the few that resonate with me, and which I feel are important for small businesses to focus on are Excessive information and communication and empty  labour. 

 

We all can see the excessive information and communication everyday….look for ways to connect with customers in a way that they want.  Quite a few organization are keeping customers in the communication channel that they entered the organization with.  E.g if a customer emailed, then the communication remains in email.  While this tactic can add to an organization processes, it can help to ensure customer connectivity and satisfaction by communicating in their preferred communication. 

 

Empty Labour as the name suggests, indicates that dollars are spent on tasks that do not provide value for the customer and ultimately these tasks impact a small business ability to grow sales. Are your employees focused on growing sales.  For example, one massage clinic I worked with had an idea to have the receptionist call patients in advance to “call demand forward”  to avoid end-of year insurance expiry.  This task helped engage the receptionist to enable the strategic objective of growing the clinic.

 

By applying the 5 Lean Principles and removing wastes, organizations can improve their operations.  Lean is about breaking down processes piece by piece and making small improvements everyday with the goal of improving processes by focusing on the customer!

Janine LeFort, Med, BBM, LBB, PMP
Professor at George Brown School of Management