October, 2007

LEAN IS SIMPLE BUT NOT EASY
By Dave Salzwedal

Several studies have indicated as little as 50% and as much as 95% of all costs in both manufacturing and non-manufacturing environments may be due to waste in the work processes.

In my previous articles, I defined waste as the absence of value-added, or something the end customer wouldn’t choose to pay for. Lean is a systematic approach to identifying and eliminating waste through continuous improvement.

The first four traditional forms of waste mentioned were: overproduction, waiting, unnecessary transport or conveyance, and over processing or incorrect processing. Now, let’s look at the remaining four:

• Excess inventory – Regardless of whether it’s the result of over-buying, over-production, or its overstocking office forms and supplies, it is still waste. Obsolescence can become a related problem. Be sensitive to your ordering and usage patterns.
• Unnecessary movement – Wasted motions, looking for parts or forms, and walking are examples of this waste. This is related to organization (or disorganization) of the work space. Look at work flow differently to make improvements.
• Defects – Repair, rework, and correction of mistakes can generate scrap, wasted time and wasted effort. It used to be acceptable that inspections and audits were the ways to eliminate defects going to the customer. That expensive process has been replaced by correcting the defect at the point of occurrence.
• Underutilized people – By not listening to or engaging employees, their ideas, skills and opportunities to learn and grow are lost to the organization. Innovation is hot right now. Take advantage of resources available to unleash it in your organization.

When you look at any process where lean thinking has not yet been applied, you may be surprised to learn that most of the steps in many processes are really waste! That is why becoming lean is so important.

According to author Michael George, the goal of lean is to “accelerate the velocity of any process by reducing waste in all its forms.” The overarching benefit of lean is to see the cost and lead time reduction opportunities where you have never seen them before.

By proper and frequent application of lean tools and concepts, you may soon find that the process steps that you once thought were essential are unnecessary, and their costs and delays are removable after the tools have been applied.

“Getting lean” and “lean” have become corporate buzzwords, the things to say your company is doing if asked at a meeting or at a cocktail party. With so much interest in it, so much published, and such positive results from organizations that “are lean,” you might wonder why everyone isn’t doing it and why every company who has tried it has not had fantastic success.

The reason has been shown time and time again with all sizes of organizations in all industries: lean is simple but not easy.

As reported in a two-year research study by the consulting firm of McKinsey and Company, the number one reason for failure in attempting to implement lean is no performance focus by senior management. The number two reason, they found, is lack of a winning strategy.

In How to Prevent Lean Implementation Failures, Larry Rubrich reports a similar reason of lack of top down management support. The lean journey has got to be understood, accepted, and embraced by the entire organization, with senior management proudly holding the “marching banner.”

If you missed my previous articles on lean, email a request for them and I’ll send them to you without delay (or waste). Watch for my next article about the Five Principles of Lean.  

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