Transformation is a necessary part of business. It helps companies ensure they provide value to the customer. Organizations have always explored new ways to transform the way they work, but it’s only recently that many started applying Lean principles. And it’s not by coincidence, either. Lean principles have helped many successful companies, including Nike and Intel, create healthier, more sustainable production systems.
In this blog, we’ll look at the eight key Lean principles that helped Nike and countless other businesses drive success across their entire organization. What’s more, you can use these principles to guide you as you integrate Lean into your business strategy. That way, you’re prepared to transform your business so that it meets the demands of a dynamic professional landscape.
Let’s get started.
1. Continuous Improvement
Lean’s primary purpose is to challenge the status quo. It’s looking at the way your business currently does things and trying to find ways to improve.
But what does continuous improvement really mean? A number of things.
Historically, Lean was associated with reducing waste. Organizations that adopted the Lean approach, decades ago, would go through various purge sessions, cutting costs and people when necessary. But Lean is about constantly changing, and that means even Lean principles change over time.
Today, Lean doesn’t focus exclusively on reducing waste, as in people. These days, waste is defined as:
- Long wait times between steps in a process.
- Context switching.
- Unnecessary planning.
Among other things that prevent organizations from working efficiently.
As such, the goal of continuous improvement is to reduce the type of waste mentioned above, not people. That way, companies can maximize efficiency and improve their speed of value delivery. Organizations achieve this by committing themselves to learning and being open to new business philosophies.
But that’s not all. Lean is also committed to adding value, because a large part of continuous improvement focuses on increasing value as well. This is also why Lean no longer prioritizes removing waste. Because when organizations add value, they create systems that are inherently more efficient.
2. Optimizing the Whole
Lean thinking also emphasizes the holistic improvement. Organizations are expected to continuously optimize their entire value stream, not individual teams and functions. The whole value stream is worth far greater than the sum of its parts, allowing organizations to gain more value from improving an entire system, rather than using resources to address a single cog in the machine.
Organizations do this through a process known as value stream mapping. It’s a Lean management technique that gives companies a visual representation of every step involved in producing an item, including its delivery it to the customer. You can learn more by reading our in-depth article on value stream mapping and how it’s used to optimize delivery across an organization.
3. Eliminating Waste
While reducing waste isn’t the sole purpose of Lean management, it is an important part of Lean thinking. With that said, the definition of waste is slightly different under this philosophy. For starters, anything the customer wouldn’t pay for is considered waste under the Lean approach. Everything from excessive work in process to time spent working on tasks that could’ve been automated is considered waste under Lean. And it’s leadership’s job to eliminate any processes, practices, and activities that don’t increase value for the customer.
4. Building Quality In
When Lean managers talk about Building Quality In, they’re referring to the concept of error-proofing their value stream. They do this through automation and standardization. Basically, this approach takes a look at all tedious, repetitive processes prone to human error and looks at ways to automate them. Or, at the very least, develop a series of procedures for workers to follow that reduces errors.
While an essential Lean principle, Building Quality In is especially important for organizations scaling beyond their homegrown systems.
5. Fast Delivery
This is one of the most important Lean principles. The reason why Lean prioritizes fast delivery is because of the value that comes from feedback. Lean thinking believes that there’s value in any experience where work reaches the customer.
But that’s only the half of it. The other reason why Lean promotes fast delivery is because of feedback. The faster products reach the customer, the quicker your organization receives feedback on those products. You can then use that feedback to tweak and enhance your product, which feeds into Lean’s core philosophy: striving for continuous improvement.
Of course, there’s more to promoting fast delivery than simply having workers rush through delivery. Managers need to optimize flow, so that teams don’t become distracted and sidetracked. This is achieved by limiting work in progress so that teams are able to devote 100% of their attention to value delivery.
6. Creating Knowledge
This concept ties into the principle of Optimizing the Whole. Remember, the Lean method, at its core, focuses on ways you can improve your organization. And to drive that improvement, there must be an effort to learn more about production and management. As such, a Lean organization is an organization that values learning.
For a Lean organization to succeed, they must create a company culture that prioritizes the acquisition on knowledge. This means building the infrastructure necessary to record and share knowledge in a way that helps everyone retain what they’ve learned. For this to happen, companies must devote as much time to learning as they do to customer-delivered work. You can do this by:
- Giving teams time to reflect on their delivery, looking at what went well and what could’ve been improved.
- Hold routine team meetings where workers can discuss, as well as, brainstorm solutions to any challenges they’re facing.
- Cross-train your employees.
Following the three steps listed above will help you create a space for learning, while also empowering teams to work faster and add more value to your organization and your products.
7. Deferring Commitment
It may seem counter-intuitive to adopt a noncommittal approach, but Deferring Commitment is an important Lean principle. The reason for this is that making decisions and commitments too far in advance can cause businesses to deliver out-of-date products, which takes away from the value and creates unnecessary waste. Because of this, businesses operating under Lean principles are urged to make decisions at the last responsible moment. That way, they’re able to make informed decisions using relevant information.
8. Respecting People
Finally, Lean organizations recognize the value created by their employees. It’s their expertise and hands-on experience that ensures projects run smoothly. For this reason, Lean organizations respect their employees and create a workplace environment that:
- Empowers employees to do their best work.
- Is conducive to retaining employees.
This is an important Lean principle for two reasons. First, when employees do their best work, they’re constantly improving and adding value to the organization. Moreover, companies that respect employees tend to retain quality talent. This eliminates waste by keeping members of the team focused on creating value, rather than training new workers.
Want to Learn More?
By following the Lean principles in this post, you’ll be well equipped to optimize your organization and keep up with the ever-changing professional landscape. If you’d like to learn more about the benefits of Lean and how you can use it in your organization, download our ebook, “Getting Started with Lean.”