Expert Opinion

George Alukal , ASQ (American Society for Quality) Fellow and certified quality engineer notes [2] that lean methodologies are receiving increasing attention by quality professionals and managers. Lean methodologies are originally derived largely from the very successful Toyota Production System (TPS) which is based on the use of common sense quality improvement tools. Over time lean methodologies have been extended from a pure manufacturing environment to a wider "lean enterprise" emphasis.

While traditionally used within the manufacturing industries, lean methodologies are increasingly being applied within service organisations such as financial institutions, government operations, and hospitals. Each organisation has different expectations which require individual consideration, however there are common threads associated with all lean implementations. While the application of lean tools and techniques is mostly common sense, sustaining lean implementations requires discipline, motivation, incentives, good change management, and strong long-term leadership. After working with a few hundred organisations Alukal reports the following common essentials required for successful lean implementations:

• Management commitment.

• A well-thought-out master plan, including
• Plans for cultural change
• Communication
• Lean training
• Standardisation , or embedding, practices at the improved level, plus
• Rewards and recognition

• Alignment of company goals with individual and team goals.

• A plan to address the fear of downsizing associated with lean improvements.

Lean Manufacturing

Lean manufacturing techniques focus strongly on reducing inventory levels and the elimination of waste, with the objective of this focus being to impact the cost, quality, and delivery times of finished goods. Common lean techniques for minimising inventory levels and eliminating waste include:

• Cellular manufacturing

• Just-in-Time/continuous-flow production

• Quick-changeover techniques

• Kanban/pull systems

• Predictive or preventative maintenance

• Focused-factory production systems

• Lot-size reductions, and

• Bottleneck/constraint removal.
  

The benefits derived from lean production systems can include:

• lower production costs

• more efficient use of personnel

• less time needed to field new products or services

• higher quality

• higher profitability, and

• greater system flexibility 
  

Lean methodologies differ markedly from traditional management and accounting practices. Thomas Johnson a professor of business administration at Portland State University who was awarded the 2001 Shingo Prize for Excellence in Manufacturing Research writes [3] that lean practices involve:

Empowering employees to detect and correct anomalies promptly is a normal expectation of work in a lean setting. Abnormalities are not considered to be an individual's fault, but rather a consequence of a breakdown in the pattern of relationships inherent in the work. By contrast in traditional settings errors are often attributed to an individual person, or machine. Such errors are usually detected by inspecting work after it is completed.

The president of Schonberger & Associates, Richard Schonberger, wrote [4] that lean methodologies have been developed to new levels; he refers to basic lean processes as "Lean Lite" and the newer processes as "Lean Extended". The following table adapted from Schonberger [2] outlines the differences between the two systems:

With "Lean Extended" the dominant objectives are ever improving quality, quicker response, greater flexibility, and higher value in addition to the dominant objective defined by traditional lean initiatives i.e. the elimination of waste. A central distinguishing feature of Lean Extended practices is the extensive company-to-company collaboration that it encourages. The extended process also tends to assign ownership to the party having most advanced capabilities at a given time and this tends to encourage the use of best practices. Companies using Lean Extended methodologies have demonstrated significant performance achievements.

Lean categories of waste

George Alukal [5] outlines the following categories of waste addressed through the use of lean principles:

• Overproduction; providing excess goods, (or earlier than required), to the next stage in the process.

• Inventory; carrying more materials, parts or information than necessary.

• Correction of defects; e.g. quality problems necessitating rework, repair or replacement.

• Over processing; effort that adds no value to the product or service from the customer's viewpoint.

• Idle time; delays while waiting for manpower, materials, information, machinery or equipment, inspection and sign-offs etc.

• Personnel; underutilising employee experience, knowledge, creativity and skills.

• Motion; Unnecessary extra movement by personnel that does not add value from a customer's viewpoint.

• Transportation; excess or unnecessary movement of parts or information.

Through the continuous reduction (or elimination) of each of these categories of waste, costs, cycle times and quality problems may be significantly reduced.

Lean Thinking

Womack and Jones [6] describe the following five step process associated with lean thinking and lean transformation activities:

• Specify value from the standpoint of the end customer

• Identify all the steps in the value stream

• Make the value creating steps flow toward the customer

• Let customers pull value from the next upstream activity

• Pursue perfection

Value Stream Mapping (VSM) and continuous improvement projects are key components of lean analysis and its implementation. According to Alukal [2] each VSM experience leads to the preparation of:

The future state map is used for kaizen events which address identified bottlenecks and constraints. VSM procedures can enable total lead times to be drastically reduced and bring them closer to value-added processing times. The aim being to maximise the value-added activities and to minimise lead times. The implementation plans serve as a guide for reducing the different kinds of waste, and acts as a guide for moving organisations or processes from the current state to a desired future state.

Peter Coote a principal at the Wexner management consultancy, and Stathis Could, a technical manager at the International Federation of Accountants, provides [7] the following guidelines for delivering customer value without waste in a financial accounting environment:

Jamie Flinchbaugh co-founder of the Lean Learning Center stated [8] that lean is not simply a methodology to be implemented on a once-only basis and then be forgotten, lean is intended to be an ongoing journey that enhances everyday learning. Through the rigorous application of each lesson learned, organisations can achieve significant improvements; however the creation, and the sustaining, of a "learning culture" is not easy and requires a special combination of curiosity and humility. This combination leads to the enabling of individuals, and organisations, to readily admit that there are better ways of achieving most things. Armed with this knowledge and by working with persistence and discipline, important discoveries can be made leading to significant improvements.

Lean and Six Sigma

Lean and Six Sigma are powerful management philosophies with tool sets which compliment, rather than compete with, one another. Alien Pannell [9] an executive consultant specialising in process innovation and redesign, explains that lean generally involves a "macro" approach, dealing with improving lead-times, reducing inventory, and eliminating waste. Six Sigma on the other hand focuses more on sub-processes. The following chart adapted from [9] outlines the key performance indicators found in lean and Six Sigma: 

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