Lean is a methodology centered on preserving value while minimizing input.
Modern management has its roots in industrial engineering, which developed over two hundred years of industrial revolution. Industrial engineering was perhaps overly focused on improving a work station individually. In Japan, Toyota developed more encompassing concepts and practices and called it Total Industrial Engineering (TIE) – later, this would become known worldwide as the Toyota Production System (TPS).
The key differences from classical industrial engineering were concept of pull, flow, visual management and use of creativity of hands-on people. One can say lean is holistic in business terms.
Based on Toyota’s success, this new way of thinking was firstly adapted by corporations within Japan to the varying degrees. As the concepts were taken to Western manufacturing companies such as GE, this way of thinking was given the name ‘Lean’ in early 1990s. Now it is a world-wide phenomenon, spreading well beyond manufacturing into banking, health care and other service industries. A number of applications in public arena remain unexplored.
Lean is an integrated approach to delivery of product or service, making all out effort to eliminate MUDA (waste), MURA (unevenness) and MURI (overburden) in the process, and continuing effort of better utilization of resources. Muda, mura and muri are three Japanese worlds that Toyota calls the 3M approach.
Often, delivery of a product or service will go through multiple stages before it lands in a customer’s hands. How these stages are designed and connected dictates the level of non-value added activities unintentionally built into the process.
Intuitively, we tend to think batch rather than flow – for example, all classes in a school will start at the same time. In other words, waste between stages is usually designed into a working system while improvements within a particular stage of a process is optimized. However, the end to end process cannot improve until holistic thinking takes place – and Lean provides the tools to achieve this holistic improvement. The concepts of pull, flow and visual management, once learned, helps to create an up spiral of improvement cycle in collective thinking of an organization.
Some of the other tools in Lean kit include:
- Value Stream Mapping
- Kaizen (change for the better)
- Six Sigma (repeatability)
- 5S (orderliness, clean workspaces)
- Empowered Teams, and
- The Pursuit of Perfection