What is Lean Management?

Lean Management

What is Lean Management? The Concept is Changing the World of Business

Managing a business team is like leading an Army.

There are strengths and weaknesses. There are needed moments of tough love and those times of unwavering support. A business team should be united in a purpose and a goal.

Enter lean management, a concept that has taken the world of business by storm. Companies around the world have been embracing the streamlined process of managing work that’s designed to both improve and maximise performance that improves both morale and company output.

But what exactly is lean management? Let’s take a closer look.

The Lean Management Approach

The keyword here is “lean.” Lean methodology started as a concept in the manufacturing sector but has grown in use by multiple industries, since it can really be applied to any business process, including marketing, lenders, banking, and software.

The overarching goal: improving business output in the most effective way possible.

Lean management is guided by a few universal ideas, including fostering continuous employee and business improvement, giving customers expected and consistent value, and — this is a big one — eschewing company waste. That means doing away with anything that doesn’t yield the best product possible.

Under the concept of lean management doing everything possible to improve the performance of a company is brought to the forefront. It means taking a hard look at a company’s ingrained work style or processes and tweaking it to up the profitability, quality, and productivity of employees.

“Lean” is an apt word to describe the management outlook. Like a lean cut of meat, managers are cutting out the fat, getting their business plan down to the most effective and most impactful bare bones.

Principles of Lean Management

The beauty of lean management lines in its principles revolving around both customer needs and employee satisfaction.

Lean management generally involves five key principles:

1. Knowing value

Under lean management, identifying a company’s value is key. That value is usually defined by the needs of its customers — they’re the ones paying for the product after all — and understanding how exactly your product is helping your customer.

Everything about your company should revolve around tapping into the extreme value of your product. Under lean management, anything that doesn’t bring value to a product is a waste of time and energy.

2. Writing out the value stream

Once you’ve grasped the details of your value, a value stream is needed. In this principle, you’re mapping out your company’s workflow — and that includes everyone involved in delivering your product and all of their actions.

Within this principle, you are uncovering what brings value to your company and what does not — the big picture of what makes your team successful or not.

3. Establishing a clean, clear, and concise workflow

We’ll throw in another “c” word here: continuous. Here, you’re aiming to create a continuous, lean-and-mean workflow that is smooth and successful.

There’s no room for fat here when outlining the best workflow. You identify and eliminate bottlenecks and roadblocks and, at the same time, elevate the teamwork that leads to the best product possible.

4. Understanding a product’s pull and what it takes to create that pull

Developing a pull system comes from stabilising your workflow. With a pull system, you’re optimising your resources and products delivery by pulling work only if there’s demand for such work.

5. Prioritising continuous improvement

The last principle is perhaps the most important to lean management. Improvement isn’t improvement unless it is made continuously.

Continuous improvement involving all employees is the hallmark of successful lean management. Fostering improvement can come from various types of managerial techniques, such as leading weekly meetings with honest discussions about what’s working and what’s not.

History of Lean Management

Lean management is a 20th century phenomenon. Its birth is typically attributed to the Toyota company (who called it the “Toyota Way.”).

It didn’t get the “lean” name tagged to the management style until the 1990s when lean management’s five principles were formally developed.

The concept of “lean” applying to efficiency, predates Toyota, however. Though it didn’t go by that name specifically, lean management was valued by such manufacturing titans as Henry Ford.  

Sakichi Toyoda, who founded the company that would later become Toyota, studied the mass production system and flow production created by Ford.

The specific principles of lean management were outlined first in the 1991 book “The Machine That Changed the World,” by Daniel Roos, Daniel T. Jones, and James P. Womack.

Benefits of Lean Management

Lean management has taken hold at many companies because of its many immediate advantages. These include: 

Renewed focus

Reducing your company’s wasteful activities drastically can have a revolutionary impact. The biggest benefit: More focus. By cutting the waste, your team can streamline its activities that produce the most value to the company and your consumers. 

The power of the pull

The pull system is integral to lean management and to accelerated productivity. By focusing on work that reflects actual demand, you are able to maximise your company’s and employees’ resources more efficiently. 

Increased productivity

With tailored and targeting focus and priority placed on true, created value, productivity can go through the roof since unnecessary tasks and effort are done away with.

Better team management

When guided by lean principles, teams in various industries can experience new vigour and refocused purpose. Priorities are not only well-defined but better managed by a company. The team actually becomes a team.

Notable Lean Leaders

Looking to learn more about those who have led the way in lean management beyond Toyoda and Ford? Here are a few of the innovators.

Taiichi Ohno

Japanese industrial engineer Ohno is actually considered the father of the system that would later become known as lean manufacturing. His Toyota Production System paved the way.

Frederick Winslow Taylor

An American mechanical engineer, Taylor is considered one of the first-ever management consultants. His book “The Principles of Scientific Management,” published in 1911, showcased his mastery of industrial efficiency.

W. Edwards Deming

Deming, an American statistician, was so impressed with Japanese industry ingenuity that he brought the concepts to America, focusing on improved quality and management.

Shigeo Shingo

Another Toyota veteran, Shingo was a prominent manufacturing improvement consultant and authored the influential book “Revolution in Manufacturing: The SMED System.”

Interested in implementing lean management in your business?

Our lean programme has run for over 18 years helping over 650 companies accross many sectors. It has identified £65 million in business savings and improvements since its conception. You could also attract funding of up to 95% of the costs.

Find out more by following the link below.

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At RKMS we are determined to make a business run as efficiently as possible. Will that next business be yours?

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Do you want us to take care of your fire compliance? H&S compliance? ISO certification? training? human resources?

At RKMS we are determined to make a business run as efficiently as possible. Will that next business be yours?

John Keen
Apart from work John enjoys sports (football, karate & walking) as well as travel & spending time with friends & grandchildren.

Do you want us to take care of your fire compliance? H&S compliance? ISO certification? training? human resources?

At RKMS we are determined to make a business run as efficiently as possible. Will that next business be yours?

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