Lean Implementation Overview

A Point of View on
Lean Implementation

Roper & Associates Inc.

Executive Summary
 Lean manufacturing* is a proven approach to dramatically
improve operating performance

 Lean success has been elusive for most organizations, with
benefits much less than advertised and much harder to maintain

 Lean success depends on seven key elements:
 Three integrated system elements
 A lean operating system
 Sustained by a lean management system
 Supported by appropriate organizational mindsets and
behaviors
 Four implementation strategies:
 Implement by value stream; deploy in “generational waves”
 Implement to achieve specific, measurable business objectives
 Decide in advance how to “cash the check”
 Support with a robust change management structure

* - we use lean manufacturing generically; the same thoughts would apply to administrative lean implementations
Page - 2

Executive Summary

Lean implementation is the
bridge to improved value
stream performance Change management structure
Organizational mindsets
& behaviors

Current
State
Lean management
Lean operating
system
Future State
system Performance
Performance
Lean operating
system

Specific quality, cost, delivery & asset productivity improvement objectives

If any of the seven key elements of lean success is missing, lean
implementation will fail or deliver sub-optimal results

Page - 3

Three integrated system elements
 Lean operating system
 Lean management system
 Organizational mindsets and behaviors

Page - 4

Lean operating system
 An operating system is the process by which
material, information, people and assets are
organized and used to deliver value to
customers
 For a manufacturer this includes equipment,
processes, layout, inventory, facilities,
planning and scheduling practices,
manpower, etc.
 Application of lean technical tools improves
operating system performance by reducing
waste in processes
Page - 5

 Operating performance improves as waste and variability
is driven out of micro-processes and flexibility is improved
 However, lean technical solutions alone are not sufficient
to achieve and sustain lean’s full potential

Process inputs Operating system Performance outcomes
(Performance = Sum
of micro-process perf)
Material Quality
Performance
People Cost
Inhibitors
•Variability
Information •Waste Delivery
•Inflexibility
Assets Asset prod

Page - 6

 Using lean tools, processes are designed to
produce specific results (improved relative to
non-lean processes)
 Operating performance improves as lean
process improvements are implemented and
sustained
 But . . . sustained results don’t just happen;
specific management processes must be
used to ensure that lean processes operate
as designed
 A lean management system is required

Page - 7

Lean Management System
 A Lean Management System is the set of formal systems,
structures and accountabilities needed to manage and improve
lean processes day to day
 A Lean Management System includes:
 Intense focus on work group performance and any deviation from
expected results
 A daily accountability management process to identify and react to
deviations
 Metrics to define expected performance and measure deviation
 Leader standard work to ensure a focus on process management
 A lean management system is initially needed to build the
organizational discipline required to sustain new lean processes
 A lean management system ultimately leads to “lean culture”
 the employee involvement, problem solving and process
improvement focus essential for lean success

Page - 8

 “Culture” is the sum of people’s habits,
related to how they get their work done
 Culture cannot be developed directly; it
results from the management system
 The lean management system forces the
required practices to be performed until they
become the new habits, or culture

“It is easier to act your way into new ways
of thinking than it is to think your way
into new ways of acting.”
Paraphrased from Toyota

Page - 9

 Daily Management Systems (DMS) are used
to build organizational discipline, drive focus
on performance and create “new habits”
 DMS is applied at the work group (micro-
process) level, and has several key elements:
 Primary visual display
 Shift start up meetings (and daily accountability
process)
 Lean daily control system (metrics and leader
standard work)
 Work group action sheets

Page - 10

Organizational mindsets & behaviors
 Organizational leaders set the tone; they must understand
lean systems and support core beliefs, such as:
 Lean is a business system, not a manufacturing (only) system
 Process discipline is critical; it must be established and sustained
 Focus must be on system effectiveness, not functional efficiency;
within manufacturing and across the business
 Must “trust” process improvement to drive results (“Creativity
before capital”)
 Value people and empower them to succeed
 Recognize that a lean system is only as strong as its weakest link;
all organizational functions must align to support lean processes

Page - 11

Organizational mindsets & behaviors

 Leadership includes all management in a
business from shop supervisors to senior
leaders
 For many, new mindsets and behaviors will be
foreign concepts that must be coached and
practiced to be learned
 For others, they will be intuitive, especially for those
involved in previous lean implementation successes
 For lean to succeed, there can be NO
exceptions to supporting the required mindsets
and behaviors – there will be casualties along
the way
Page - 12

Four implementation strategies
 Implement by value stream and deploy in
generational waves
 Target specific measurable business
objectives
 Define in advance how to “cash the check”
 Support with robust change management
structure

Page - 13

Organize by value stream

 Experience has shown that value stream based
lean implementation is most effective
 Demonstrates measurable business results for
integrated product flow
 Opportunity to apply full range of lean tools
 Opportunity to integrate lean operating system and
management system, as well as align necessary
support functions
 Supports generational deployment approach
 Effectively target improvement activities
A (production) value stream is all the actions (both value adding and non-
value adding) to bring a product from raw material to the customer
Lean Enterprise Institute
Page - 14

Deploy in generational waves

 Generational wave deployment sets the pace
of lean implementation, integrating the need
for results, with the realities of support
requirements and organizational capacity for
change
 Generational waves of lean deployment
 “Chunk up” implementation to make it manageable
 Provide a logical deployment path for lean
implementation
 Leverage internal learning and staff development

Page - 15

Example - Organize by value stream – Deploy in waves
Phase
VS I VS II VS III VS IV
Targets TBD TBD TBD

Deploy in Generational Waves
A •Reduce mfg lead time/WIP & simplify process management

12 – 15
Months
(3-4 months
Implement By Value Stream
per VS)

Wave II projects to further improve existing
B value streams
6 - 12 months
Expand lean implementation internally –
order entry, engineering, etc.

Wave III projects to further improve existing
C value streams
6 - 12 months
Expand lean implementation externally –
suppliers and customers

Target specific improvement objectives
 “If you don’t know where you’re going, any
road will take you there.”
 To generate the required organizational focus
and commitment for lean success,
improvement objectives (what’s being
targeted through lean implementation) must
be specific, business based and significant
 If not significant and specific:
 the organization will not always make the changes
necessary to achieve it, or
 the organization will declare victory too soon and
fail to achieve lean’s full potential

Page - 17

Target specific improvement objectives
 Performance objectives must be based on an
evaluation of current operations:
 identify key performance inhibitors within the operating
system
 define impact of eliminating or reducing them
 Such evaluations are typically performed by value
stream, understanding for each:
 What process steps are involved in satisfying customer
demand (and which are truly value adding)?
 Where lean improvements should be targeted to improve
value stream performance?
 How significant the performance improvements should be –
QCDAS
 Such evaluations must specifically address
management system and behavior/mindset needs
Page - 18

Define in advance how to “cash the check”

 Successful lean implementation will improve
operational performance by increasing capacity
 Performance improvement will not flow to the bottom
line unless something changes, e.g. people leave,
sales increase, overtime decreases, work is
insourced, etc.
 People immediately “see” the improvement
opportunity and will question how it will be realized by
the business
 Management must have a credible plan for how the
improvement will be realized, communicate it as part
of the lean implementation and follow it

Page - 19

Change management structure
 Changing an organization, with lean implementation
or any other initiative, is different than managing one
 Change related activities must be separated from day
to day management activities and focused on
intensely to succeed
 An Executive Steering Team or leadership team must
plan the implementation, then meet regularly to:
 Review progress against the plan
 Address barriers to achieving plan objectives
 Names are irrelevant, the keys to success are:
 Have a dedicated change management organization
 Have the discipline to follow the process rigorously
 Focus on deliverables, not activities, and effective
countermeasures to achieve results

Page - 20

Change management structure
 The leadership team and change management
process are crucial to ensure that mindsets and
behaviors align to support lean
 Traditional management focuses on results and fire
fights daily to achieve it
 Lean management installs sound processes, then
sustains and improves those processes to achieve
results
 A lean organization’s mindsets and behaviors
must evolve to focus on process discipline and
continuous improvement as the way to improve
performance
Page - 21

Summary
 Successful lean implementation can dramatically
improve business performance (QCDAS)
 To succeed, lean must be viewed as a business
system that extends beyond manufacturing
 A lean system focuses on improving and
sustaining micro-process performance, to
improve organizational performance
 A successful lean manufacturing system must
have three integrated elements
 Operating system
 Management system
 Organizational mindsets & behaviors
Page - 22

Summary
 Successful lean implementations follow four
strategies
 Implement by value stream and deploy in
generational waves
 Target significant, measurable improvement
objectives
 Define in advance how to cash the check
 Support implementation with a robust change
management structure
 Successful lean implementations typically
proceed through phases and are managed
using policy deployment tools

Page - 23

Lean Implementation Overview

More Related Content

What's hot (20)

Viewers also liked (20)

Similar to Lean Implementation Overview (20)

Recently uploaded (20)

Lean Implementation Overview