How to Apply Lean Methodology
What is lean methodology and how does it apply to your business and marketing? Read this article for information on how to apply this method efficiently.
Ready for your business to become lean and mean?
Nearly 70% of manufacturing companies use the principles of lean. But businesses can apply lean thinking to everything from manufacturing to retail. It’s a way of reviewing your business to boost value to customers and cut waste.
So what is lean methodology, and how do you apply it? Below, we’re covering the basic principles you’ll need to know.
What is Lean Methodology?
Lean originated as a production-line method for reducing waste and increasing value to customers. Since then, managers have applied lean thinking to almost all kinds of business. You can apply its principles almost anywhere that has a beginning-to-end process.
Lean methodology basically comes down to two key questions:
Does this add value to the customer?
Can we cut it without losing productivity?
The phrase “add value” is core to lean thinking. Value means the direct benefit to the customer, whether it’s a service, product or after-sale support.
Obviously, there’ll always be elements of a process which don’t directly add value for a customer. But lean methodology keeps these to the necessary evils.
Lean methodology helps businesses map out their workflow. Once that’s done, it provides principles for identifying and cutting out waste. By the end of it, you’re left with much higher efficiency – and better value for the customer.
Lean principles break down into five major steps. Let’s take them one by one.
How can you increase value for your customers if you don’t know what value looks like? It’s time to define how customers draw value from your business.
Hit the obvious areas of value first. These usually relate directly to your core business. A retailer offers value in the products they make available. A marketer offers value by promoting their clients’ business to new customers.
But there are less obvious areas of value, too. Technical support and aftersales care are two great examples. Together, these make up the core purpose of your business.
Map the Value Stream
Sick of hearing “that’s how we’ve always done it?”. Then this step is for you.
Here’s the part where to note down all the steps involved in your processes. Capture every single part of the process, from inception through to the point the customer comes on board, and then to delivery and aftercare.
You want to capture everything here, not just the parts that deliver value to customers. Anything your business does as part of its delivery process should be noted.
Notice all the water terminology? An efficient business process flows like water from its source to its destination.
Establishing flow describes the process of creating a smooth transition between all stages of the workflow. The smoother the flow, the more efficient your business.
This is your opportunity to tighten up the sequence of steps from inception to delivery. Shave off inefficiencies and focus on communication.
Identify some of the major bottlenecks in your operation. If teams are suffering from poor communication, find ways around it. Are parts of the process held up by others? Finding ways to eliminate these will increase the flow.
You can gain a surprising amount of efficiency by allowing customers to lead your process.
Traditional business involves maintaining large inventories, pre-fabbing stock, and hoping for orders. But a lot of this comes from the inefficiency of the systems in place.
With more efficient systems, you can let customers and clients lead your processes. You don’t need to front-load as much of your process when you can meet orders in a much shorter turnaround time.
That allows you to cut down on even more waste, like excessive inventory or wasted product. It also gives your business flexibility, so you can free up valuable time to meet actual rather than hypothetical demand.
We’re all chasing perfection, aren’t we? That’s the ultimate goal of lean, too.
Lean methodology is a living process. You should continually adjust your workflow based on new information, feedback, and new technology to gain new efficiencies.
The ideal system would have zero waste. Practically this may not be possible, but it provides a benchmark you should work toward.
Lean methodology should become part of your workplace culture. At its best, it’s not a manager-led initiative. Instead, all employees should take responsibility for keeping processes lean.
Lean checkups are also vital. Companies always slide toward increased waste if they’re not vigilant.
Of course, one of the main goals of lean is to cut down on waste. So let’s look at how lean defines waste.
Avoid Tim Wood, he’s trouble. “Tim Wood”, or “Timwood”, is a way to remember the 7 major waste factors. They are:
- Transport – or the delays caused by shuffling things around
- Inventory – or the space wasted by unused stock
- Motion – or the delays lost moving within a process
- Wait – or waiting for one part of the process before the next can begin
- Over-processing – or work that no longer adds value for the client
- Over-production – or work that exceeds demand
- Defects – or the work lost to mistakes
By taking each of these and breaking it down in detail, you can see how waste occurs. For instance, excessive record-keeping is a common over-processing problem. If workers seem to input the same information in three different places, see what you can do to cut it.
More efficient workstation layouts or communication methods can cut down on transport and motion problems. Modern flexible working using the cloud can allow employees to work together even from remote locations.
Moving to a pull-based workflow can cut down on inventory and transport issues. Instead of storing and maintaining excessive stock, you can use your more efficient processes to meet demand in almost real time.
Cut Out The Waste With Lean Principles
We’ve covered the basic principles of lean methodology here, but it’s always possible to dive deeper. Take a look at your business and see how lean could firm up your process to increase efficiency. The more efficient you are, the more you can do for less.
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