What is Lean Management?
Lean management is an approach to running an organisation that supports the concept of continuous improvement, a long-term approach to work that systematically seeks to achieve small, incremental changes in processes in order to improve efficiency and quality.
Lean is an improvement model and collection of tools that emphasises the elimination of all types of waste (muda) and non-value-added activities, and the delivery of high-quality products at the lowest possible cost. The focus of Lean is on producing more goods with fewer resources by driving continual improvement in all areas of business performance, including cost, productivity, efficiency, and safety, health, and environment (SHE). Key principles of a Lean supply chain include:
1. Value is defined by the customer.
2. The supply chain and value stream should flow continuously.
3. The entire organisation must manage toward perfection by eliminating waste and adding value.
Lean Management works well with ISO 9001:2015 Quality Management System, especially for an organisation that has an established quality system. It also works well for any organisation that is looking to improve processes and reduce muda. At the heart of both ISO 9001 and Lean Management is Kaizen, which is derived from the Japanese as Continuous Improvement. Kaizen helps you get rid of waste and continuously implement best practices.
There are 5 Lean Principles, these are:
1. Define Value - Value is what the customer is willing to pay for your product or service. It is paramount to discover the actual or latent needs of the customer.
2. Map Value Stream - Identify and mapping the value stream. In this step, the goal is to use the customer’s value as a reference point and identify all the activities that contribute to these values. Activities that do not add value to the end customer are considered waste.
3. Create Flow - After removing the wastes from the value stream, the following action is to ensure that the flow of the remaining steps run smoothly without interruptions or delays.
4. Establish Pull - Inventory is considered one of the biggest wastes in any production system. The goal of a pull-based system is to limit inventory and work in process (WIP) items while ensuring that the requisite materials and information are available for a smooth flow of work. Pull-based systems are always created from the needs of the end customers.
5. Pursue Perfection - Pursuit of perfection is the most important Lean Principle of them all. It makes Lean thinking and continuous process improvement a part of the organisational culture.