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There are many businesses out there that operate with a mindset of “Well, that’s how we’ve always done it.” Unfortunately, this type of close-minded thinking can lead to a great deal of waste.
Tasks may be unnecessary to achieve the final goal, processes may be repeated multiple times when one would be sufficient, employees may be wasting time on superfluous responsibilities, and materials may be wasted during manufacturing.
When this occurs within an organization, employee satisfaction decreases so turnover increases, quality suffers so customer satisfaction and retention is decreased, and one look at the books will likely indicate the company is hemorrhaging money.
You might think that this type of operational inefficiency only occurs in large corporations and organizations, however, it’s just as prevalent in small-to-medium-sized businesses and can be seen throughout every department.
Efficiency is the name of the game for successful businesses, and you’re about to learn one of the best ways to turn your business into a lean, mean, money-making machine.
Lean Process Improvement
What is lean process improvement?
Lean process improvement is a concept originally developed by Toyota to decrease the amount of time it took from receiving an order to delivering it. While lean process improvement is often discussed in a production environment, the concept can be applied to service, healthcare, technology, and even government.
Consider a marketing department that has multiple people working on the same project but not communicating. Rather than each handling a specific aspect of the campaign, several people tackle the same task while other activities go unhandled.
It’s not a traditional production environment, however, the team could benefit from creating an easy-to-follow process that looks at the desired end product and finds the simplest route to get there.
The whole idea behind this way of thinking is that when you look at the big picture, you can find ways to eliminate waste, whether that’s financial, physical, time, or employee energy that could be spent elsewhere. This concept may take a while to implement, and that’s okay. It’s not meant to be a short-term solution, but rather a change to the entire mindset and culture of a business.
What are the benefits of lean process improvement?
Businesses that incorporate lean process improvement see a variety of benefits from this shift. These include:
It makes perfect sense that when you remove the redundancy, streamline processes, and create less waste, your bottom line will increase. When your customers receive their product faster and with less hassle, you’ll have happier customers who return and recommend you to others. With more customers, your bottom line increases once again.
If you’d like to see this type of improvement in your organization, read on to learn lean process improvement steps.
How do I incorporate lean process improvement into my business?
You guessed it … there’s a process to lean process improvement. There’s actually a series of nine steps you’ll need to implement to create this level of efficiency in your organization. Let’s take a closer look at lean process improvement steps.
1. Review the process you want to improve.
This step is essential because if you don’t know what you need to work on, you won’t know where to focus your efforts. In order to do that, you need to talk to employees on the front line.
The biggest mistake companies make during this process is implementing changes without ever speaking to the people who do the job day in and day out. Interview your frontline workers, and ask them what’s not working well in their daily routine.
2. Identify what improvements need to be made.
Once you’ve identified what needs to be fixed, it’s time to involve your team once again. There’s a very good chance that they already know how to fix the problem and just haven’t been able to implement it because of a “That’s-how-we’ve-always-done-it” mindset.
3. Implement the suggested changes.
How will you put the changes into action? Create a plan so everyone involved understands and buys into the process. This is the best way to ensure organization-wide success.
4. Monitor how the changes are impacting your efficiency.
While it would be great if your first attempt at execution was a success, the reality is that once the process is tested in the field, it will need to be further refined. The only way to do this is through constant monitoring and reevaluating. As new issues appear, you can address them and make the necessary changes.
5. Identify what activities add value.
Throughout these steps, you’ll be assessing every single action and every aspect of your process. During this time, you must evaluate every single activity to determine whether it adds value to your process, or detracts. If an activity is deemed unnecessary, it should be removed and the process tested without it.
6. Limit risk.
Production and often business, in general, is inherently risky. This time should be used to identify any risky activities or aspects that are part of the current process and eliminate or simplify these tasks. This may involve automating an activity or simply changing the way in which it’s executed.
7. Standardize the process.
As you create and refine the process, document your progress thoroughly. This allows the process to be repeated, properly, by other employees or depending on the specific process, by other teams or departments in your organization.
8. Ensure compliance.
While lean process improvement should be a company-wide shift in culture, your industry or governing body may have specific metrics, procedures, and standardized measurements that you must adhere to. Compliance may not be sacrificed in the name of efficiency.
9. Improve the customer experience.
In determining the success of a lean process improvement plan, Marketers consider the customer experience to be “the moment of truth.” Ultimately, whatever improvements you make during production or service must trickle down to positively impact the customer.
Lean Process Improvement Tools
As you embark on this journey, there are a number of tools available to you. These tools can help you organize your thoughts, identify issues, and implement your plan. The following are just some of the tools you can look to for support.
Just like any other tool, the one you choose must be the right one for the current job. If you start out with one and don’t find that it meets your needs, consider trying another.
Why Analysis: By asking “Why?” repeatedly, you can identify the root cause of the challenges you’re experiencing.
Ishikawa Diagram: Also known as a “Fishbone diagram” or “cause-and-effect diagram”, it allows you to examine a problem from multiple angles, including measurements, materials, people, methods, machines, and environment.
Affinity Diagram: This works great in the early stages of lean implementation as it can help sort and organize large amounts of data. Identify the value you bring to the customer and then uncover problems with your existing processes.
FMEA Analysis (failure mode and effects): Catching issues before they get out of hand can help you eliminate waste and save money. This tool allows you to examine your flow and identify problems early on.
5S Dashboard: This approach can help you organize your workspace for maximum efficiency. While the original tool has five S’ based on Japanese terms, many businesses have added a 6th practice. These stand for:
Set in order
Plan Do Check Act (PDCA) Cycle: Create continuous improvement by repeatedly analyzing a problem, testing a hypothesis, reviewing, and then analyzing the results, and finally, putting the plan into action once it’s successful.
Lean Process Improvement Techniques
There are a number of approaches that have been created to assist in lean process improvement. Just like the tools, it’s important to find the right technique for your project and your organization. For example:
Six Sigma (DMAIC Model)
With a goal of reducing the variation in processes, Six Sigma works to increase both external and internal customer satisfaction by standardizing workflow. The DMAIC Roadmap stands for:
These boards allow you to visualize your workflow and use value stream mapping to break down your workflows into stages. Having a visual representation of your workflow, and all the activities that make it up, can assist you in identifying inefficiencies.
Sharing this board with your entire team allows anyone to stop the process when a problem occurs. Now, it becomes everyone’s job to find a solution.
Within Kanban boards exist a concept known as WIP Limits or “Work in Progress Limits”. Every stage in a Kanban board workflow is represented by a column. WIP limits force you to stay under a maximum number of work items for each stage. This can be per person, per work stage, or for the entire project.
Having these limits in place ensures that current tasks are finished before new ones are started, and helps to complete activities faster.
Final Thoughts on Lean Process Improvement
Now that you understand how important lean process improvement is to a successful, efficient organization, it’s a good time to reiterate that this is an ongoing process. If you attempt to overhaul your entire organization overnight, you will undoubtedly fail and most likely make things worse than when you started.
Identify the biggest sources of inefficiency in your organization and target these first, one at a time, until you’ve created a well-functioning business.
Finally, remember that your most valuable assets are the employees getting their hands dirty every day. Attempting to identify problems and create solutions without getting their input is akin to driving blind when you could simply open your eyes.