What is Lean or Lean Management?

Lean management is about creating the most value for the customer at the least cost, which is achieved by minimizing resources, time, energy and effort. It is a process-oriented improvement methodology.

Our definition of Lean thinking and doing is:

Systematically developing people and continuously improving processes to bring value and prosperity with the least possible use of resources.

A lean approach to work is about:

1. Understanding what is really going on at the place where value is created - commonly known as the gemba;
2. Improving the processes by which products and services are created and delivered;
3. Developing and empowering people through problem solving, kaizen, mentoring and coaching;
4. Developing leaders and an effective management system.

Lean thinking and practice helps organizations become both innovative and competitive, which in turn enables them to become sustainably profitable. In a lean organization, problems are opportunities for meaningful learning rather than being swept under the rug or quickly fixed. Managers act as coaches, helping others identify problems and practicing daily continuous improvement. Leadership means creating a management system to support a new kind of engagement with the real work, the way work is done now.

In short, Lean is a collective name for a set of tools, methods, concepts and philosophy aimed at achieving maximum value for the customer with minimum use of resources. The focus is on improving processes in order to shorten the lead time, increase quality and reduce costs.

The five Lean principles

These principles are:

1. Define value from a customer perspective;
2. Identify the value streams in your organization (i.e. map all your process steps) and eliminate waste (non-value adding activities) in your processes;
3. Create Flow where possible (let the service or product flow through your organization). Ensure that products or services flow smoothly to the customer, without interruptions, by executing the value-creating steps in a tight order;
4. From push to pull: only deliver something when there is a demand from the customer;
5. Aim for perfection (continue to improve). Try to achieve a situation where value for the customer is created without waste.

In addition to these principles, numerous methods, techniques and approaches are available to us. Underlying principles are: Respect for people, Fit for purpose, Customer first, Gemba/Genchi Genbutsu (fact based, work floor orientation), Kaizen/Continuous Improvement, PDCA, Go See - Ask Why - Show Respect.

What isn't lean?

• Reduction of staff ("lean = mean");
• A collection of tools or tools that you implement: 5S, Kaizen events, value stream maps, andon, visual management, metrics, dashboards, A3, etc;
• A program (efficiency improvement, process improvement, performance management, MBO, cost reduction, Six Sigma, etc.) imposed on the people who do the work (and therefore create value) by management, external consultants or internal expert staff;
• Something that only applies to production or operations;
• Training and certification in order to achieve the highest possible belt without practical experience;
• Enforce compliance with standard work and address people when they deviate from it(management by fear).
• A protected brand name. Our founders (Jim Womack & Dan Jones) have chosen to make their research(s) available so that we can all make the world a little better.

Background of Lean

The term Lean was first used by our founders Jim Womack and Dan Jones in the late 1980s, in their research into the automotive industry conducted from the Massachusetts Institute of Technology (MIT), published in the book "The Machine That Changed the World"(available in our webshop).

This research showed that Toyota had superior competitive strength and that this could be explained by their specific way of conducting business. Toyota developed the lean methodology based on the Toyota Business System. They combined ideas that were already present within Toyota (such as Jidoka and Just-in-Time) with ideas that were developed by other pioneers (such as the Plan, Do, Check, Act/adjust (PDCA) cycle, standardization, and the Training Within Industry (TWI) program).

Lean principles may have their roots in Toyota's factories in Japan, but today the Lean method has become an alternative, superior approach to work - regardless of what the work is (manufacturing, office), the sector or the size of the organization.

Our founders Jim Womack (left) and Dan Jones (right)

Lean management as a business system

To improve (or transform), an organization must focus on 3 Ps:

1. Purpose: What is the purpose of our organization? In what need in society can we provide? In other words: what is customer value?
2. Process: How can we continuously improve? In other words: designing and managing efficient processes;
3. People: How can we respect everyone by making their work meaningful, and how can we actively involve and develop everyone?

The alignment of purpose, process and people is the central task of management.

What is a Lean Transformation?

The transformation of an enterprise is the process in which an organisation moves from its current business model to a desired future situation.
A Lean transformation requires learning a new way of thinking and acting, which is not characterized by implementing a series of steps or solutions, but by addressing important questions about purpose, process and people.

The video below from our Lean Global Network describes the Lean Transformation model, narrated by Lean veteran John Shook.

Wondering what Lean can mean for you?

As a foundation we were created to make the world a little better by using Lean. We would therefore like to help you on your way. There are a number of ways;

• We offer various Lean training courses, Lean Leadership programs (also at Nyenrode Business University) and Lean Workshops. As we are the only organisation in the Netherlands connected to the Lean Global network, founded by Lean founders Dan Jones and Jim Womack, you simply cannot get any closer to real lean knowledge.
• Read one of the books we publish as a foundation; think of "Lean Thinking" From Womack & Jones, "Learning to See" from John Shook or "The Toyota Way" Jeffrey Liker. You can orderthe books on Bol.com or in our webshop.

Do you have a specific question such as customization? Or can't decide where to start your Lean journey? Please contact us, we are happy to help you further.

© Header photo via our US sister institute LEI.