What is Lean Process Improvement?
The Lean process improvement helps businesses reduce non-value activities, for example, the wastage of time, resources, and energy in their operations, and focus more on value-added activities that enhance customer experience.
Toyota first applied the concept of Lean process improvement in its production process during the early 1930s. At the time, the company aimed to minimize the time taken to receive an order and deliver it to the intended target.
Since then, the concept has evolved from exclusively being used in the production industry to almost all other sectors, including service, tech, and healthcare. Here's an example of how the Lean methodology improves business process management:
Think about a company where communication between workers isn't streamlined. Such employees may engage in the same production task campaigns due to poor communication. Implementing a lean process improvement methodology can help create a step-by-step new process for employees to know what they're required to do and when to achieve the desired output faster.
What are the Benefits of Improving Processes?
A recent global study by OnePoll on the impact of technology on business administrative efficiency found that an average of 26% of an employee's day is wasted on avoidable administrative chores, unnecessary tasks, and outdated work processes. Here are some numerical examples of daily time wasted:
- 42 minutes spent on unnecessary administrative tasks
- 36 minutes spent in unproductive work conversations
- 28 minutes attending unnecessary meetings
- 26 minutes spent on outdated technology tasks
Globally, more than a third (38%) of those surveyed said their employer still relies on manual administrative processes, and nearly half (48%) believe they would be more productive if they had access to better office tools and technology.
For 40%, administrative tasks get in the way of their primary tasks, and 39% say they are regularly dissatisfied with the quality and quantity of their work throughout the day as a result.
*Source: The CFO (the-cfo.io)
Businesses can benefit from incorporating the Lean process improvement in their operations through the following ways:
Allows Operating More Efficiently
Businesses that never improve their processes always experience high wastage of time, materials, and energy. They also lose their employees and customer base in the end.
Applying Lean process improvement helps streamline an entire organization's operations. On the one hand, the process helps businesses spot the areas of waste and where material or labor and the flow of goods can be simplified. On the other hand, it also gives employees a better understanding of the company processes so they can handle tasks better and become more productive.
Helps to Maintain a Competitive Edge
Efficiency is essential for business success, and the Lean methodology helps companies to stay on top of their game. It does so by reducing tedious tasks and unnecessary processes, allowing employees to be more productive and focus on producing the best consumer output.
In return, businesses stay competitive in the market since most consumers today value excellent customer and user experiences over anything else. On top of that, companies also get to attract and retain the best employees through their onboarding processes.
Improves Business Agility
The market is ever-changing, and opportunities disappear as quickly as they arise. The Lean methodology helps companies stay updated on the current best business practices to maintain that competitive edge.
The process also helps companies keep up with emerging trends, such as sustainable business operations, by optimizing resources, production, and workforce and eliminating unnecessary waste.
Increases Employee Satisfaction and Performance
Aside from the Lean process approach allowing employees to perform tasks better, it also increases employee satisfaction. That's because adopting the process requires input from the employees, which plays a significant part in the overall approach.
When employees' feedback is valuable, they feel more appreciated, which will likely make them more productive at work.
Examples of Lean Process Ideas to Implement in a Company
Lean process improvement can apply to various work processes and industries. The following are examples and ideas of how the lean improvement approach works in different sectors today:
- Manufacturing: It is one of the industries that incorporate the Lean methodology in its operations. A good example is implementing quality checks by operators to prevent quality issues found before shipment or, worse, at the customer.
- Logistics: A lot of waste can occur while transporting production units from one place or process to another. The Lean framework helps streamline logistical functions such as route choices and production synchronization to help reduce overhead costs in the supply chain.
- Software development: The rapid change in the software industry requires companies to stay on their toes. Software companies use the Lean methodology to break down the software development cycle into steps and identify an area to improve efficiency, which helps maintain a responsive and agile workforce.
7 Steps for an Effective Lean Process Improvement
The Lean methodology follows a series of process improvement steps that lead to successful implementation in an organization. These include:
1) Be Clear on the Areas You Want to Improve
The first step of implementing the Lean methodology is knowing the exact areas that need work. That requires involving employees since they are the ones who are there daily and understand what needs fixing.
2) Identify non-value-added activities
Once the process is active, start identifying each action and aspect to determine value-added and non-value-added (NVA) activities. From there, all activities deemed unnecessary based on value should be analyzed to find solutions to reduce or eliminate waste.
3) Involve your employees
Once the identification period is over, employees will be involved in recommending solutions for the problems as they are the ones that know best about the process. They are the ones using it. This will also reinforce their sense of belonging and team spirit.
4) Implement the Changes
The next step is to put the recommended changes into action. To do this, everyone in the organization must first understand and buy into the process. Training would help employees grasp the meaning and usefulness of the changes. After all the stakeholders have a basic understanding of the process, implementation can begin.
5) Track Changes and Improve
There is no such thing as success during the first attempt to execute the Lean process improvement. It will always have room for improvement after testing in the field, so process modeling and refining is a constant. For that to happen, it is essential to track and redesign the process consistently so that the changes gear towards improving efficiency.
6) Leverage Process Improvement Tools
There are various tools available to help with the Lean process methodology. These help stay organized, identify issues and implement plans throughout the entire process. They include:
- 5S dashboard – this is a systematic approach used in Lean manufacturing to improve efficiency. It comprises five key principles that include; sort, set in order, shine, standardize, and sustain. These help improve overall efficiency and eliminate waste by ensuring that all required tools (physical or virtual) are available at the right locations through visual management.
- Ishikawa diagrams – these are causal diagrams drawn to examine the potential causes of a certain effect. In Lean process improvement, the cause and effect diagram examines problems from multiple angles, whether it's people, environment, methods, materials, or machines.
- FMEA analysis – this is a systematic and continuous method for analyzing a process. It helps identify inefficiencies within the process that might cause failure and the potential impact of that failure.
- Affinity diagram – this is a diagram that is used to sort large data during the early implementation Lean process improvement stages. By organizing data, it helps identify problems in the process easier and determine the value brought to a customer.
PDCA cycle - this is a tool used for continuous quality improvement of a company's products and/or services, as well as for problem-solving. It consists of four distinct stages: Plan, Do, Check, and Act. These are organized not in a linear way but rather in a circular way (Deming Wheel) in order to illustrate the idea of repetition and, therefore, of continuity.
- Toyota Kata - It is a powerful method of creating a culture of learning, knowledge transfer, and continuous improvement in the company by implementing routines at different levels.
Choose a tool based on the current job needs and switch if one doesn't meet the needs of the business.
7) Use Lean Process Improvement Techniques
Like tools, several process improvement methodology techniques have been created to help simplify the entire process. Examples include:
- Six Sigma – this is a strategy that uses the Six Sigma methodology to improve efficiency and reduce waste. It's best used in large-scale companies that are prone to wastage as it helps standardize process flow to improve operational efficiency. The Six Sigma strategy uses two methodologies: DMAIC (Define, Measure, Analyze, Improve, and Control) for incremental improvement of current processes and DMADV (Define, Measure, Analyze, Design, Verify) for optimization of new processes or products.
- Kanban – Kanban is a scheduling system that uses visual boards to help companies visualize and breakdown workflow. Once they visually breakdown the workflow, they identify process improvement opportunities and pain points, such as wasteful practices or bottlenecks in the workflow.
- Kaizen – this technique stresses on making continuous improvements in the workplace, including small daily changes, more employee involvement, and standardizing workflows and environments for better efficiency.
Business Process Management (BPM) - this practice focuses on the analysis and improvement of business processes, i.e., the set of activities that enable the company to achieve its objectives. It includes analyzing the current process, identifying opportunities for improvement, implementing changes, monitoring the process for improvement, and optimizing the process.
The Lean Process Improvement Project
Lean methodology streamlines existing processes to reduce waste and time-consuming activities. The result is a reduction in company inefficiencies and an increase in customer satisfaction. Follow these steps to improve your company's processes and move towards operational excellence.