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Business Management: Going Lean
A successful implemented Lean Management system divides top performing enterprises from those which gets sorted out during sluggish economy periods.
Thousands of manufacturing companies continue to make a profit even during sluggish economy periods by using lean principles. Going lean means making a continuous effort to improve a business’s productivity and sustainability. There are five important aspects involved in the implementation of lean techniques: recognizing value, mapping value-stream, creating motion, establishing pull and seeking perfection. Long lasting sustainable results can only be accomplished if a company brings safety, quality, cost, delivery, and morale together in a lean system. The primary theme of lean management is waste elimination and requires identification of areas where wasteful actions commonly occur, including:
• Waiting and Transportation
• Overprocessing (unnecessary process steps)
Employees involved in lean management need to look for examples of wasteful processes and then problem solve how to streamline production wherever they can. The desire to create something standard to prevent the failure of a business plan can be very detrimental since it can prevent a business from pursuing creative, unique ideas.
Whether lean management will focus on manufacturing or operations, the goal of any business is the same–building a more efficient working infrastructure. Since consumers want the best quality goods and services available to them on the market, businesses implementing lean management can keep up with consumer demand, boost their product or service value while continuously improving their operations.
Moving a company to the next level isn’t easy. But sticking multiple details to a business project can actually cramp a business’s movement. Perfectionism stifles a business’s flexibility if things don’t work out exactly as planned especially when it needs improvements. This is not to say that a business can’t strive for perfection. Rather, the manner in which a business objective is carried out can be greatly simplified without compromising the success of the business.
By using a set of reliable metrics, a company can eliminate practices that don’t offer real value. This, in turn, can help employees document their achievement. Metrics that track weekly, monthly or quarterly quotas can identify trends and record areas that need to be streamlined. Once these types of metrics are in force, it can be the basis for companies issuing bonus payments, supervising positions, raises, etc., to reinforce the benefits of avoiding wasteful actions among employees.
Lean management also does something else–it brings a variety of personnel from various departments together in their daily communications. Each individual is free to provide their own viewpoint and feedback of what a company’s objective should achieve and how it should be executed. Rigid guidelines create a one-size-fits-all approach that prove impractical in a marketing environment filled with changing trends and financial hurdles.
The early phases of a lean management transformation should entail at least 80 percent of adjustments to current business functions. This can be accomplished in the following ways:
• Setting up a team to evaluate and compare which current business processes provide value and which ones don’t before any permanent changes are made
• Having the team trained and guided as to how a lean implementation plan and budget could be executed the most effectively
• The application of value stream mapping should only be done to specific product families that will be transformed immediately
The majority of organizations structure management by process or function. This limits the control managers have over business processes to only specific steps instead of an entire value stream.
The task of lean management is often very overwhelming in the beginning for all levels of a company’s staff. Convincing upper management, supervisors and production workers to reevaluate how to execute their duties more efficiently takes time, to say the least. The best way to get everyone on the same page when going lean is to get upper management to incorporate lean practices in their daily activities first. Upper management must be fully committed to providing adequate resources to a company going lean so that its progress isn’t hampered.
All staff responsible for overseeing job performance can get production workers on board when going lean by showing the benefits of them working in a more productive, interactive environment. Basically, lean management can’t materialize without being accepted by production workers. Not only will they have to do more multitasking, but will also have to answer to a system integrated with numerous “checks and balances” to measure their work performance. The only way to have lean principles fully accepted by workers is to show them how going lean will increase a company’s financial stability which in turn offers greater job security. Since each person is affected by change differently, it’s up to those in charge to help their staff see the positive outcome for going lean for themselves and for others.
Lean requires thought and management adjustments. Most lean implementation failures are due to a lack of willingness to permanently change established routines, not because of a failure to grasp the tools and techniques. Teams need to become more self-sufficient, by allowing problems to be solved within the teams themselves rather than being resolved by upper management. This means that all members of staff be properly trained, which avoids internal conflict and delivers a management group that can practice lean changes to gradually eliminate waste processes more efficiently.
Additionally, hiring a skillful expert who has full insight of how the principles of lean management work can train staff to address a specific problem (i.e., reducing setup time) that arises in real world situations. This ensures that training activities have a more beneficial outcome.
If a company looks at lean transformation as just another option instead of a mandatory culture, it likely won’t succeed in its efforts. Lean management needs to be mandatory and people need to handle normal and business crises with the same enthusiasm.
It’s important that a company be tolerant of the mistakes of staff members committed to enforcing a lean environment with a supportive and positive attitude. Progress must be exercised with patience without assigning blame for setbacks experienced. A company also needs to be confident enough to take some risks at crucial stages of production to increase momentum and sustain their resources in order to complete a particular business plan successfully.
Another helpful tip for a company succeeding in lean implementation is to learn from other companies via networking. This is a key step to understand what is involved to completely transform and streamline operations from the ground up.
Efficiency becomes a top priority and helps to maximize profit or reduce costs when implemented within a factory. Therefore, a company needs to use an experienced lean management consultant(s) to provide technical assistance and advice when trying to get quick results and keep its momentum building.
It’s crucial to support the expertise of internal senior executives, improvement experts, and team leaders who believe in the lean philosophy, since these individuals will spread its disciplines throughout the organization over time. According to a survey conducted by a nonprofit management research center the Lean Enterprise Institute (LEI), employee resistance, especially by middle management, is the number one obstacle for a company to complete lean implementation. Therefore, it should be the absolute goal of a company to get support for lean implementation by middle management to ensure that they deliver on schedule against their implementation plan.
Any factory manager will agree that it’s better to address assembly line mistakes early on before products are mass produced. Lean manufacturing can help to eliminate flaws in the processing chain that need immediate attention, such as the detection of faulty steps or faulty materials used in a factory’s production phases.
Lean management greatly depends on those at the top driving the ongoing transformation of a business. The objective of this approach is to create an internal group of experienced people willing to transfer their knowledge of hands-on applications to help others learn and master certain lean processes. To be exact, building the culture of continuous improvement depends on the alignment between people, purpose, process and the scientific method of Plan Do Check Act or PDCA. Engaging in factory simulation will help a business understand the concepts of flow, pull, kaizen, work cell design, visual management and many others in the context of a total business system. The following actions, when done properly, can create a more stable business environment:
• Eliminating nonessential metrics from essential metrics. Also, measuring a diverse range of value stream metrics such as lead time, levels of inventory and first-pass quality.
• Basing business on sound data and not on opinions to improve business processes. Eliminating the emotional factor when making key business decisions promotes greater acceptance of lean management and should be reviewed on a regular basis.
• When a company’s whole staff grasps lean business perspectives, concepts and values, it will help them identify the purpose, practices and requirements of this culture. This enables all employees to work efficiently in their particular role at any level. As a result, employees will gain techniques to help them develop excellent problem solving skills on a daily basis. Techniques could include responding to requests for problem solving, gaining a thorough understanding of a problem situation and participating in a reflective discussion of the root cause of a problem situation; it could also include the ability for employees to eliminate insignificant details of a problem situation to address what’s most important to resolve an issue.
• The completion and discussion of a company’s problem solving assessment within the lean culture is imperative for building an environment of continuous performance improvement.
• Employees who engage in meaningful responsibilities and that are shown respect by upper management and by supervisors is the key to smooth productions in a lean environment.
• Having a grasp of actual marketing conditions that may affect a factory’s level of production helps leaders develop better problem solving habits when they make PDCA problem solving a mandatory pattern to follow.
• Managers can use value stream thinking to assign responsibility to appropriately trained staff; in addition, they can spend time identifying and showing business opportunities that could convince their production staff that lean really can make a difference in daily performance.
• Forming an enterprise team that’s responsible for providing support in the planning, resourcing, execution, and end result accountability for lean implementation helps to resolve internal department issues. Furthermore, supervisors need to learn to be more process focused instead of just trying to fix business processes when they go awry.