What Is Lean Management?
Lean Management is…If someone tells you that “lean management is this” and not something else, if someone puts it in a box and ties a bow around it and presents it in a neat package with four walls around it, then that someone knows not of what they speak. Why? Because it is in motion and not a framed picture hanging on the wall. It is a melody, a rhythm, and not a single note.
Lean management is generally derived from the Toyota Production System as developed by Taiichi Ohno, Shigeo Shingo and others over a forty year period. It began with efforts to reduce die change time on the stamping press which then allowed for a reduction of in-process inventory and this became just-in-time inventory management. This resulted in the need for less warehouse space, fewer forklifts, unnecessary space, etc. Once the flow of work can be interruption free, free of materials sitting, standing, and redo-loops, waste is eliminated. Lean is the elimination of waste. But, more importantly, lean is continuous improvement in all work processes.
In order to improve the work of the die press and reduce waste Shingo did not instruct the workers. He asked the workers to think. He challenged them to innovate and find ways to speed the process by eliminating unnecessary activities. The workers who operated the press and changed dies worked as a team and together they solved problems and sought improvement. It was the front line workers, who were on-the-spot, and who were truly the world’s greatest experts in their work, who experimented, watched the data, and learned from the facts.
The Essence of Lean is Continuous ImprovementThis model of improving the work process by those who do the work, by those who are on-the-spot, is the essence of lean management. The model of Shingo asking the work team to think, to experiment, and to learn from the data, is the model of lean management. It is management that is humble and not arrogant. It is management that observes, encourages, challenges, and learns. It is management that gathers the facts, encourages experimentation, and spreads best practices. It is management that practices what they preach to others. This model was quickly copied by Honda and other Japanese companies and has now become the standard of world class manufacturing. And, it has become the standard for management in all types of work settings. Lean is a moving target because, at its heart, lean is a process of learning and improvement. It cannot be defined as something that is standing still or fixed. It is not simply mimicking what happened at Toyota or anywhere else. And, most importantly, it is not a kaizen event, a project, or something done by a consultant. It is best captured as a philosophy rather than a particular method or technique. If you don’t have the philosophy, you don’t get it.
The House of LeanThis “House of Lean” describes the key components of lean management. These include both the technical aspects of lean and the social or cultural aspects of lean. My course on Lean Leadership, Lean Culture, and Change Management describes each of these components and the two critical paths to change: the design of the lean system and the development of new habits, the “Team Kata” that establishes a new pattern of continuous improvement.
Here are some ways of describing lean philosophy or culture:
- Lean is a culture of continuous improvement practiced at every level of the organization and by every team.
- Lean is the application of the scientific method of experimentation and study of work processes and systems to find improvements.
- Lean is respect for people. It is respect for the voice of the customer and it is respect for those who do the work, who are “on-the-spot” and are, therefore, the “world’s greatest experts” in their work.
- Lean is the elimination of waste in all its forms. Lean is the ability to distinguish between work that actually adds value to your customers and work that does not. By eliminating waste, you free resources to devote to value-adding activity that serves your customers.
- Lean is a work environment that assures the quality and safety of all work for both customers and staff.
- Lean is a focus on improving the work process and not on blaming people or creating fear.
- Lean is a culture of teamwork, shared responsibility and ownership that cuts through organization walls or silos.
- Lean is a culture that returns the joy to work. Honda speaks of the three joys of buying, selling and making the product. We do our best work when we have joy in our work.
- Lean is flow. Lean is an interruption free process that flows from beginning to end without interruption.
On the Beginning of Lean PrinciplesHere are three lectures on the Principles of Lean Management which are part of my course on Team Leadership.
- Project Management Home
- Activity Based Costing
- Agile Project Management
- Basic Management Skills
- Basic Quality Tools
- Benchmarking Process
- Cause and Effect Diagram
- Change Management Process
- Communication Blockers
- Communication Channels
- Communication Methods
- Communication Models
- Communications Management
- Conflict Management
- Crisis Management
- Critical Chain Scheduling
- Critical Path Method
- Decision Making Process
- Design of Experiment
- Effective Communication Skills
- Effective Presentation Skills
- Enterprise Resource Planning
- Event Chain Methodology
- Extreme Project Management
- Gantt Chart Tool
- Just-In-Time Manufacturing
- Knowledge Management
- Leads, Lags and Floats
- Management Best Practices
- Management Styles
- Management by Objectives
- Monte Carlo Analysis
- Motivation Theories
- Negotiation Skills
- Organizational Structures
- PERT Estimation Technique
- PRINCE2 Project Methodology
- Pareto Chart Tool
- Powerful Leadership Skills
- Process Based Management
- Procurement Documents
- Procurement Management
- Project Activity Diagram
- Project Charter
- Project Contract Types
- Project Cost Control
- Project Kick-off Meeting
- Project Lessons Learned
- Project Management Methodologies
- Project Management Office
- Project Management Processes
- Project Management Tools
- Project Management Triangle
- Project Manager Goals
- Project Portfolio Management
- Project Quality Plan
- Project Records Management
- Project Risk Categories
- Project Risk Management
- Project Scope Definition
- Project Selection Method
- Project Success Criteria
- Project Time Management
- Project Workforce Management
- Project Management Softwares
- QC and QA Processes
- RACI Chart Tool
- Recognition and Rewards
- Requirement Collection
- Resource Leveling
- Staffing Management Plan
- Stakeholder Management
- Statement of Work (SOW)
- Stress Management Techniques
- Structured Brainstorming
- Succession Planning
- Supply Chain Management
- Team Building Program
- Team Motivation
- The Balanced Scorecard
- The Halo Effect
- The Make or Buy Decision
- The Rule of Seven
- The Virtual Team
- Total Productive Maintenance
- Total Quality Management
- Traditional Project Management
- Work Breakdown Structure
25 Essential Lean Tools
5S
What is 5S?
Organize the work area:
Eliminates waste that results from a poorly organized work area (e.g. wasting time looking for a tool).
Andon
What is Andon?
Visual feedback system for the plant floor that indicates production status, alerts when assistance is needed, and empowers operators to stop the production process.
How does Andon help?
Acts as a real-time communication tool for the plant floor that brings immediate attention to problems as they occur – so they can be instantly addressed.
Bottleneck Analysis
What is Bottleneck Analysis?
Identify which part of the manufacturing process limits the overall throughput and improve the performance of that part of the process.
How does Bottleneck Analysis help?
Improves throughput by strengthening the weakest link in the manufacturing process.
Continuous Flow
What is Continuous Flow?
Manufacturing where work-in-process smoothly flows through production with minimal (or no) buffers between steps of the manufacturing process.
How does Continuous Flow help?
Eliminates many forms of waste (e.g. inventory, waiting time, and transport).
Gemba (The Real Place)
What is Gemba?
A philosophy that reminds us to get out of our offices and spend time on the plant floor – the place where real action occurs.
How does Gemba help?
Promotes a deep and thorough understanding of real-world manufacturing issues – by first-hand observation and by talking with plant floor employees.
Heijunka (Level Scheduling)
What is Heijunka?
A form of production scheduling that purposely manufactures in much smaller batches by sequencing (mixing) product variants within the same process.
How does Heijunka help?
Reduces lead times (since each product or variant is manufactured more frequently) and inventory (since batches are smaller).
Hoshin Kanri (Policy Deployment)
What is Hoshin Kanri?
Align the goals of the company (Strategy), with the plans of middle management (Tactics) and the work performed on the plant floor (Action).
How does Hoshin Kanri help?
Ensures that progress towards strategic goals is consistent and thorough – eliminating the waste that comes from poor communication and inconsistent direction.
Jidoka (Autonomation)
What is Jidoka?
Design equipment to partially automate the manufacturing process (partial automation is typically much less expensive than full automation) and to automatically stop when defects are detected.
How does Jidoka help?
After Jidoka, workers can frequently monitor multiple stations (reducing labor costs) and many quality issues can be detected immediately (improving quality).
Just-In-Time (JIT)
What is Just-In-Time?
Pull parts through production based on customer demand instead of pushing parts through production based on projected demand. Relies on many lean tools, such as Continuous Flow, Heijunka, Kanban, Standardized Work and Takt Time.
How does Just-In-Time help?
Highly effective in reducing inventory levels. Improves cash flow and reduces space requirements.
Kaizen (Continuous Improvement)
What is Kaizen?
A strategy where employees work together proactively to achieve regular, incremental improvements in the manufacturing process.
How does Kaizen help?
Combines the collective talents of a company to create an engine for continually eliminating waste from manufacturing processes.
Kanban (Pull System)
What is Kanban?
A method of regulating the flow of goods both within the factory and with outside suppliers and customers. Based on automatic replenishment through signal cards that indicate when more goods are needed.
How does Kanban help?
Eliminates waste from inventory and overproduction. Can eliminate the need for physical inventories (instead relying on signal cards to indicate when more goods need to be ordered).
KPIs (Key Performance Indicators)
What are KPIs?
Metrics designed to track and encourage progress towards critical goals of the organization. Strongly promoted KPIs can be extremely powerful drivers of behavior – so it is important to carefully select KPIs that will drive desired behavior.
How do KPIs help?
The best manufacturing KPIs:
What is Muda?
Anything in the manufacturing process that does not add value from the customer’s perspective.
How does Muda help?
It doesn’t. Muda means ‘waste’. The elimination of muda (waste) is the primary focus of lean manufacturing.
Overall Equipment Effectiveness (OEE)
What is Overall Equipment Effectiveness?
Framework for measuring productivity loss for a given manufacturing process. Three categories of loss are tracked:
Provides a benchmark/baseline and a means to track progress in eliminating waste from a manufacturing process. 100% OEE means perfect production (manufacturing only good parts, as fast as possible, with no downtime).
PDCA (Plan, Do, Check, Act)
What is PDCA?
An iterative methodology for implementing improvements:
Applies a scientific approach to making improvements:
What is Poka-Yoke?
Design error detection and prevention into production processes with the goal of achieving zero defects.
How does Poka-Yoke help?
It is difficult (and expensive) to find all defects through inspection, and correcting defects typically gets significantly more expensive at each stage of production.
Root Cause Analysis
What is Root Cause Analysis?
A problem solving methodology that focuses on resolving the underlying problem instead of applying quick fixes that only treat immediate symptoms of the problem. A common approach is to ask why five times – each time moving a step closer to discovering the true underlying problem.
How does Root Cause Analysis help?
Helps to ensure that a problem is truly eliminated by applying corrective action to the “root cause” of the problem.
Single-Minute Exchange of Dies (SMED)
What is Single-Minute Exchange of Dies?
Reduce setup (changeover) time to less than 10 minutes. Techniques include:
Enables manufacturing in smaller lots, reduces inventory, and improves customer responsiveness.
Six Big Losses
What is Six Big Losses?
Six categories of productivity loss that are almost universally experienced in manufacturing:
Provides a framework for attacking the most common causes of waste in manufacturing.
SMART Goals
What are SMART Goals?
Goals that are: Specific, Measurable, Attainable, Relevant, and Time-Specific.
How do SMART Goals help?
Helps to ensure that goals are effective.
Standardized Work
What is Standardized Work?
Documented procedures for manufacturing that capture best practices (including the time to complete each task). Must be “living” documentation that is easy to change.
How does Standardized Work help?
Eliminates waste by consistently applying best practices. Forms a baseline for future improvement activities.
Takt Time
What is Takt Time?
The pace of production (e.g. manufacturing one piece every 34 seconds) that aligns production with customer demand. Calculated as Planned Production Time / Customer Demand.
How does Takt Time help?
Provides a simple, consistent and intuitive method of pacing production. Is easily extended to provide an efficiency goal for the plant floor (Actual Pieces / Target Pieces).
Total Productive Maintenance (TPM)
What is Total Productive Maintenance?
A holistic approach to maintenance that focuses on proactive and preventative maintenance to maximize the operational time of equipment. TPM blurs the distinction between maintenance and production by placing a strong emphasis on empowering operators to help maintain their equipment.
How does Total Productive Maintenance help?
Creates a shared responsibility for equipment that encourages greater involvement by plant floor workers. In the right environment this can be very effective in improving productivity (increasing up time, reducing cycle times, and eliminating defects).
Value Stream Mapping
What is Value Stream Mapping?
A tool used to visually map the flow of production. Shows the current and future state of processes in a way that highlights opportunities for improvement.
How does Value Stream Mapping help?
Exposes waste in the current processes and provides a roadmap for improvement through the future state.
Visual Factory
What is Visual Factory?
Visual indicators, displays and controls used throughout manufacturing plants to improve communication of information.
How does Visual Factory help?
Makes the state and condition of manufacturing processes easily accessible and very clear – to everyone.
What is 5S?
Organize the work area:
- Sort (eliminate that which is not needed)
- Set In Order (organize remaining items)
- Shine (clean and inspect work area)
- Standardize (write standards for above)
- Sustain (regularly apply the standards)
Eliminates waste that results from a poorly organized work area (e.g. wasting time looking for a tool).
Andon
What is Andon?
Visual feedback system for the plant floor that indicates production status, alerts when assistance is needed, and empowers operators to stop the production process.
How does Andon help?
Acts as a real-time communication tool for the plant floor that brings immediate attention to problems as they occur – so they can be instantly addressed.
Bottleneck Analysis
What is Bottleneck Analysis?
Identify which part of the manufacturing process limits the overall throughput and improve the performance of that part of the process.
How does Bottleneck Analysis help?
Improves throughput by strengthening the weakest link in the manufacturing process.
Continuous Flow
What is Continuous Flow?
Manufacturing where work-in-process smoothly flows through production with minimal (or no) buffers between steps of the manufacturing process.
How does Continuous Flow help?
Eliminates many forms of waste (e.g. inventory, waiting time, and transport).
Gemba (The Real Place)
What is Gemba?
A philosophy that reminds us to get out of our offices and spend time on the plant floor – the place where real action occurs.
How does Gemba help?
Promotes a deep and thorough understanding of real-world manufacturing issues – by first-hand observation and by talking with plant floor employees.
Heijunka (Level Scheduling)
What is Heijunka?
A form of production scheduling that purposely manufactures in much smaller batches by sequencing (mixing) product variants within the same process.
How does Heijunka help?
Reduces lead times (since each product or variant is manufactured more frequently) and inventory (since batches are smaller).
Hoshin Kanri (Policy Deployment)
What is Hoshin Kanri?
Align the goals of the company (Strategy), with the plans of middle management (Tactics) and the work performed on the plant floor (Action).
How does Hoshin Kanri help?
Ensures that progress towards strategic goals is consistent and thorough – eliminating the waste that comes from poor communication and inconsistent direction.
Jidoka (Autonomation)
What is Jidoka?
Design equipment to partially automate the manufacturing process (partial automation is typically much less expensive than full automation) and to automatically stop when defects are detected.
How does Jidoka help?
After Jidoka, workers can frequently monitor multiple stations (reducing labor costs) and many quality issues can be detected immediately (improving quality).
Just-In-Time (JIT)
What is Just-In-Time?
Pull parts through production based on customer demand instead of pushing parts through production based on projected demand. Relies on many lean tools, such as Continuous Flow, Heijunka, Kanban, Standardized Work and Takt Time.
How does Just-In-Time help?
Highly effective in reducing inventory levels. Improves cash flow and reduces space requirements.
Kaizen (Continuous Improvement)
What is Kaizen?
A strategy where employees work together proactively to achieve regular, incremental improvements in the manufacturing process.
How does Kaizen help?
Combines the collective talents of a company to create an engine for continually eliminating waste from manufacturing processes.
Kanban (Pull System)
What is Kanban?
A method of regulating the flow of goods both within the factory and with outside suppliers and customers. Based on automatic replenishment through signal cards that indicate when more goods are needed.
How does Kanban help?
Eliminates waste from inventory and overproduction. Can eliminate the need for physical inventories (instead relying on signal cards to indicate when more goods need to be ordered).
KPIs (Key Performance Indicators)
What are KPIs?
Metrics designed to track and encourage progress towards critical goals of the organization. Strongly promoted KPIs can be extremely powerful drivers of behavior – so it is important to carefully select KPIs that will drive desired behavior.
How do KPIs help?
The best manufacturing KPIs:
- Are aligned with top-level strategic goals (thus helping to achieve those goals)
- Are effective at exposing and quantifying waste (OEE is a good example)
- Are readily influenced by plant floor employees (so they can drive results)
What is Muda?
Anything in the manufacturing process that does not add value from the customer’s perspective.
How does Muda help?
It doesn’t. Muda means ‘waste’. The elimination of muda (waste) is the primary focus of lean manufacturing.
Overall Equipment Effectiveness (OEE)
What is Overall Equipment Effectiveness?
Framework for measuring productivity loss for a given manufacturing process. Three categories of loss are tracked:
- Availability (e.g. downtime)
- Performance (e.g. slow cycles)
- Quality (e.g. rejects)
Provides a benchmark/baseline and a means to track progress in eliminating waste from a manufacturing process. 100% OEE means perfect production (manufacturing only good parts, as fast as possible, with no downtime).
PDCA (Plan, Do, Check, Act)
What is PDCA?
An iterative methodology for implementing improvements:
- Plan (establish plan and expected results)
- Do (implement plan)
- Check (verify expected results achieved)
- Act (review and assess; do it again)
Applies a scientific approach to making improvements:
- Plan (develop a hypothesis)
- Do (run experiment)
- Check (evaluate results)
- Act (refine your experiment; try again)
What is Poka-Yoke?
Design error detection and prevention into production processes with the goal of achieving zero defects.
How does Poka-Yoke help?
It is difficult (and expensive) to find all defects through inspection, and correcting defects typically gets significantly more expensive at each stage of production.
Root Cause Analysis
What is Root Cause Analysis?
A problem solving methodology that focuses on resolving the underlying problem instead of applying quick fixes that only treat immediate symptoms of the problem. A common approach is to ask why five times – each time moving a step closer to discovering the true underlying problem.
How does Root Cause Analysis help?
Helps to ensure that a problem is truly eliminated by applying corrective action to the “root cause” of the problem.
Single-Minute Exchange of Dies (SMED)
What is Single-Minute Exchange of Dies?
Reduce setup (changeover) time to less than 10 minutes. Techniques include:
- Convert setup steps to be external (performed while the process is running)
- Simplify internal setup (e.g. replace bolts with knobs and levers)
- Eliminate non-essential operations
- Create Standardized Work instructions
Enables manufacturing in smaller lots, reduces inventory, and improves customer responsiveness.
Six Big Losses
What is Six Big Losses?
Six categories of productivity loss that are almost universally experienced in manufacturing:
- Breakdowns
- Setup/Adjustments
- Small Stops
- Reduced Speed
- Startup Rejects
- Production Rejects
Provides a framework for attacking the most common causes of waste in manufacturing.
SMART Goals
What are SMART Goals?
Goals that are: Specific, Measurable, Attainable, Relevant, and Time-Specific.
How do SMART Goals help?
Helps to ensure that goals are effective.
Standardized Work
What is Standardized Work?
Documented procedures for manufacturing that capture best practices (including the time to complete each task). Must be “living” documentation that is easy to change.
How does Standardized Work help?
Eliminates waste by consistently applying best practices. Forms a baseline for future improvement activities.
Takt Time
What is Takt Time?
The pace of production (e.g. manufacturing one piece every 34 seconds) that aligns production with customer demand. Calculated as Planned Production Time / Customer Demand.
How does Takt Time help?
Provides a simple, consistent and intuitive method of pacing production. Is easily extended to provide an efficiency goal for the plant floor (Actual Pieces / Target Pieces).
Total Productive Maintenance (TPM)
What is Total Productive Maintenance?
A holistic approach to maintenance that focuses on proactive and preventative maintenance to maximize the operational time of equipment. TPM blurs the distinction between maintenance and production by placing a strong emphasis on empowering operators to help maintain their equipment.
How does Total Productive Maintenance help?
Creates a shared responsibility for equipment that encourages greater involvement by plant floor workers. In the right environment this can be very effective in improving productivity (increasing up time, reducing cycle times, and eliminating defects).
Value Stream Mapping
What is Value Stream Mapping?
A tool used to visually map the flow of production. Shows the current and future state of processes in a way that highlights opportunities for improvement.
How does Value Stream Mapping help?
Exposes waste in the current processes and provides a roadmap for improvement through the future state.
Visual Factory
What is Visual Factory?
Visual indicators, displays and controls used throughout manufacturing plants to improve communication of information.
How does Visual Factory help?
Makes the state and condition of manufacturing processes easily accessible and very clear – to everyone.